German Inflation Unexpectedly Eases In December

(RTTNews) - Germany's consumer prices rose for a third straight month in December, but the pace of increase eased, defying expectations for an acceleration, preliminary data from Destatis showed Monday.

The consumer price index climbed 0.3 percent year-on-year following 0.4 percent increase in November, which was the fastest pace in six months. Economists had expected a 0.6 percent gain.

Prices fell 0.1 percent from the previous month, in contrast to expectations for a 0.2 percent increase. In November, the CPI edged up 0.1 percent.

The harmonized index of consumer prices, or HICP, which is meant for EU comparison purposes, rose 0.2 percent year-on-year after a 0.3 percent climb in November. Economists had forecast a stronger figure of 0.4 percent.

Month-on-month, the HICP remained unchanged from the previous month, while economists had expected a 0.2 percent rise.

The Destatis also reported that annual average inflation sharply eased to 0.3 percent in 2015 from 0.9 percent in 2014. The annual average HICP inflation tumbled to 0.1 percent from 0.8 percent.

In December, the Bundesbank cut the inflation estimate for 2015 to 0.2 percent from 0.5 percent, citing a "hitherto unanticipated renewed decline in crude oil prices".

The bank expects inflation to accelerate as the dampening effect of crude oil prices gradually peters out. The projection for next year was cut to 1.1 percent from 1.8 percent. The outlook for 2017 was also reduced to 2 percent from 2.2 percent.

The agency is set to release the final figures on January 19.