- July final CPI +2.8% vs +2.8% y/y prelim
- Prior +2.3%
- July final HICP +2.8% vs +2.8% y/y prelim
- Prior +2.4%
German headline annual inflation is reaffirmed to have nudged up in July. However, the good news at least is that core annual inflation is seen easing marginally to 2.4% – down from 2.5% in June.
Food price inflation was seen at 2.5% with services inflation seen at 2.9%. The latter is still on the high side but at least is seen slowing from 3.1% in June.
Overall, price pressures remain elevated as energy prices continue to stay underpinned for the most part. Destatis notes that one additional reason to the higher headline print for the July report was likely the expiry of the fuel rebate on 30 June. As such, that saw fuel prices rise by a whopping 23.0% year-on-year in July. That’s much higher than the preceding two months of 11.3% in June and 18.0% in May.
All in all, the report here will keep the ECB on their toes in looking to the end of the summer break and on to September. With the US-Iran conflict still raging on, there’s still every chance the central bank needs to do more to bring down price pressures further by year-end.
This article was written by Justin Low at investinglive.com.