German Inflation Surprisingly Lower
Preliminary inflation data has just been made available for Germany. The headline Consumer Price Index year on year number for March has come at 1.0%, lower than the previous months reading of 1.2%. The month on month number also trended down at 0.3% compared with February’s reading of 0.5%.
Germany also published it’s Harmonized Index of Consumer Prices (HICP) data, this uses a slightly different calculation method and is the figure officially used by the European Central Bank (ECB) in it’s deliberations. The HICP number was 0.9% year on year which is in line with expectations and points to a stabilizing of Eurozone inflation. The HICP month on month figure came in slightly lower than last month’s reading at 0.3%.
Price stability readings are currently the key metric for the health of the Eurozone economy. The ECB, which has very little scope to introduce further stimulus, is struggling to ignite economic activity within the Euro bloc. The ECB is still striving to raise inflation to it’s official target of 2%. Earlier this month the Bank downgraded it’s inflation projections which show the Eurozone is on a path to only achieve price growth of 1.7% by the end of 2016.
There are however glimpses of a changing sentiment within the Euro area bloc, this mornings Eurowide Consumer Confidence number showed signs of improvement, although still negative it is moving in the right direction and at an accelerating pace. Industrial and Services sentiment indicators also ticked up for the Eurozone as did the key Economic Sentiment Indicator.
Next week will be a crucial one for Eurozone economics. Unemployment, GDP growth and CPI figures are all expected early in the week ahead of Thursday’s ECB meeting. As of now no change to the 0.25% rate is anticipated but that could change as the week progresses and a clearer picture of the health of the Eurozone economy emerges, particularly in light of today’s low inflation figures.
Sorry. No data so far.