German inflation fell to 1.8% in September, lower than expected | Wilnesh News

Preliminary data released by the German statistics office Destatis on Monday showed that Germany’s unified consumer price index fell to 1.8% in September, lower than expected.

According to a Reuters survey, the unified CPI data in September is expected to be 1.9%. exist Augustthe coordinated CPI dropped unexpectedly to 2%.

On a monthly basis, the preliminary coordinated CPI fell by 0.1%. A Reuters poll showed the monthly data was expected to be unchanged.

LSEG data shows that the last time Germany’s unified CPI data was below 2% (the European Central Bank’s inflation target rate) was in February 2021.

Inflation data for the euro area and EU are consistent to ensure comparability.

Core inflation, which excludes food and energy costs, was 2.7% in September, down slightly from 2.8% in August. Meanwhile, service sector inflation fell back to 3.8% after stabilizing at 3.9% for several consecutive months.

Data from the Bureau of Statistics also showed that energy costs fell by 7.6% in September.

Inflation is likely to pick up before the end of the year as base effects are expected to ease or even reverse, Deutsche Bank Research economist Sebastian Becker said in a note on Monday.

“Judging from today’s data, the inflation problem has not yet been completely resolved. To do this, the core inflation rate, which remains high, also needs to ease significantly. And the decline is still large,” he said, according to a CNBC translation.

Becker noted that continued wage pressure means services and core inflation are likely to decline only slowly.

Data released earlier on Monday showed inflation slowed in several major German regions in September, including a fall in North Rhine-Westphalia, the country’s most populous state. soften It rose to 1.5% in September from 1.7% in August.

Within Europe, data released last week showed unified inflation rates in France and Spain fell below their 2% target in September.

The German data comes a day before the euro zone is expected to release inflation data, which will be closely watched by investors for the possibility of another rate cut by the European Central Bank. Earlier this month, the bank implemented its second rate cut this year.

Carsten Brzeski, ING’s global head of macro, said on Monday that the German data was “another strong argument” for a rate cut at the European Central Bank’s October meeting.

“A recent series of disappointing economic sentiment indicators and lower-than-expected inflation data have given the ECB doves a new and powerful argument,” he said.