German EU-harmonised January consumer prices rise 9.2% y/y

Christmas shopping amid COVID-19 outbreak in Berlin
People with protective face masks walk at Kurfurstendamm shopping boulevard, amid the coronavirus disease (COVID-19) outbreak in Berlin, Germany, December 5, 2020. REUTERS/Fabrizio Bensch
  • Harmonised German consumer prices in Jan rise 9.2% y/y
  • Downward trend in inflation expected to continue - Commerzbank
  • Core inflation forecast to remain high, economists say

BERLIN, Feb 9 (Reuters) - German consumer prices, harmonised to compare with other European Union countries, rose by a less-than-anticipated 9.2% on the year in January, preliminary data from the federal statistics office showed on Thursday.

Compared with December, prices increased by 0.5%, it added.

Analysts had expected harmonised data to grow by 10.0% on an annual basis and increase by 1.2% on the previous month.

According to non-harmonised standards, German consumer prices rose 8.7% on year in January and 1.0% on the month.

"The downward trend in inflation visible in the old figures should continue in the coming months, as the rise in energy prices is likely to ease further," said Joerg Kraemer, chief economist at Commerzbank. However, he warned that it is too early to sound the all-clear on the inflation front.

Kraemer said inflation excluding energy and food was likely to remain stubbornly high this year, mainly because of rising wage costs.

"Because core inflation will remain high in 2023, a fundamental easing of inflation is not in sight," said Alexander Krueger, chief economist at Hauck Aufhaeuser Lampe Privatbank.

The consumer price index for Germany is revised as part of a regular process. With effect from January, the base year has been moved to 2020 from 2015 previously.

The final results for January and all results recalculated from January 2020 onwards using the new 2020 base year will be published by the statistics office on Feb. 22.

The statistics office offers a breakdown for January's figures on its website.

Reporting by Friederike Heine, Rachel More and Maria Martinez Editing by Miranda Murray and Jacqueline Wong

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