German annual inflation eased in February as the strong euro helped to contain oil and other import prices, signalling that the rate is also likely to fall in the wider euro zone.
In the first national indication of prices in the 12-country bloc this month, preliminary data from the Federal Statistics Office today showed German inflation slipped to 0.9 per cent from 1.2 per cent in January.
On a monthly basis the rate increased to 0.2 per cent in February from 0.1 per cent in January, a rise analysts attributed to increased German healthcare costs under government reforms.
"Overall we're seeing significant reductions in inflation in underlying terms. Without the health reforms the figure would be much lower," said Lehman Brothers economist Ms Sandra Petcov.
"In dollar terms oil prices are still very high, but they're significantly lower in terms of the euro, which has helped to keep down inflation in Germany," she said.