PARIS (Reuters) – German inflation calculated by European standards rose more slightly than expected in May, but economists polled by Reuters said the rise, in line with expectations, should not influence European Central Bank officials (ECB) ahead of their interest rate decision next week.
According to preliminary data published Wednesday by the Federal Statistical Office, the consumer price index, in its HICP version, which allows comparison between euro zone countries, accelerated to 2.8% over a year in May in Germany, against a Reuters consensus of 2.7% and after an increase of 2.4% in April.
Over one month, HICP inflation rose by 0.2% after 0.6% in April and in line with the consensus of economists.
Inflation figures in Germany, the euro zone’s largest economy, are closely followed by economists, before the publication of data for the entire euro zone on Friday and one week before the monetary policy decision of the BCE, June 6.
“This expected increase in inflation will not change anything in the ECB’s decision next Thursday,” said Elmar Voelker, economist at LBBW.
The ECB “will therefore proceed with the planned reversal of interest rates”, she added, while specifying that the evolution of prices during the summer will decide the speed of further monetary easing thereafter. .
Michael Heise, economist at HQ Trust, notes, however, that the ECB has a “difficult choice” to make.
“The current and expected price trend in the coming months does not yet show a clear convergence towards the central bank’s 2% objective,” he emphasizes.
Core inflation in Germany, which excludes volatile food and energy prices, was stable month-on-month in May at 3%, according to data from the Federal Statistical Office.
Inflation calculated according to German standards increased by 0.1% in May after +0.5% in April, against a consensus of +0.2%. Over one year, it stood at +2.4%, in line with the consensus and after +2.2% in April.
Preliminary data published on Wednesday morning showed an acceleration in the rise in consumer prices in three Länder but stagnation in two others in May.
(Written by Augustin Turpin, edited by Kate Entringer and Blandine Hénault)
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