German regional data show inflation above forecast

Regional data from the German states of Brandenburg and Saxony showed consumer prices in Germany likely rose more than expected…

Regional data from the German states of Brandenburg and Saxony showed consumer prices in Germany likely rose more than expected during March, driven by an increase in the cost of oil and seasonal foods.

Data from the eastern states' statistics offices today showed that prices in both rose by 0.4 per cent from February.

However, excluding energy and seasonal foodstuffs, consumer costs would have been unchanged.

Economists said the data meant there was a risk that the rate of annual inflation in the 12-nation euro zone would accelerate from February's 2.1 per cent.

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The annual inflation rate in Brandenburg was unchanged from February at 2.2 percent, while in Saxony it rose by 0.1 percentage point to 1.8 percent, the data showed.

Consumer price data from these and four other states due out on Thursday are used to calculate a national inflation estimate.

They also provide an initial glimpse of wider price trends across the euro zone. Economists polled ahead of the states' data forecast prices in Europe's largest economy would rise by 0.2 per cent on the month and by 1.7 per cent year-on-year in March.

In February, German prices rose by 0.4 percent on the month and by 1.8 per cent on the year. DZ Bank economist Bernd Weidensteiner said the data pointed to a higher rate of inflation in March than had been forecast.