German harmonised inflation rate revised down

Germany's annual inflation rate was cut to 0

Germany's annual inflation rate was cut to 0.9 per cent in June from a preliminary 1 per cent, the Federal Statistics Office said today.

Compared with May, Germany's harmonised index of consumer prices (HICP) rose 0.2 per cent, not 0.3 per cent as previously reported, it said.

Its inflation rate was harmonised to compare with that of other EU countries.

In May, German HICP fell 0.3 per cent month on month, bringing annual inflation down to 0.6 per cent and helping reduce the euro zone's inflation rate to 1.9 per cent, just under the 2 per cent tolerance ceiling set by the European Central Bank.

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On the basis of the preliminary data from Germany and that of other euro zone nations, European statistics office Eurostat said on June 30th it estimated euro zone inflation rose back up to 2 per cent in June. Eurostat is due to release final June inflation data around July 16th.

According to the German statistics office's national methodology, German consumer prices in June were confirmed at up 0.3 per cent month on month and up 1.0 per cent year on year. In May consumer prices had decreased 0.2 per cent month on month and were up 0.7 per cent year on year.

The statistics office said June inflation was driven by pre-summer increases in the cost of package holidays (+5.1 per cent month on month) and hotel rooms (+4.8 per cent). Fruit and vegetables were also more expensive.

In contrast to previous months, oil prices had little impact, with the consumer price index excluding oil products also rising 1.0 per cent year on year. Compared with May, the ex-energy index rose 0.2 per cent.