Berlin – Inflation slowed down in Germany in June, show the preliminary data published Monday by the Federal Statistics Office, contradicting forecasts of a slight increase in prices on prices in the largest economy in Europe.

German inflation calculated according to European standards (IPCH) slowed down 2% over one year this month, while analysts interviewed by Reuters anticipated +2.2% in June after +2.1% in May.

Over a month, IPCH inflation slowed down at +0.1% this month, while analysts were waiting +0.3% after +0.2% in May.

Basic inflation, which excludes the more volatile prices of food and energy, has decelerated 2.7% in June, against 2.8% the previous month.

The German data precedes the publication of inflation in the euro zone, which will take place on Tuesday.

According to economists interviewed by Reuters, inflation in the block should reach 2% in June, the target of the European Central Bank (ECB), against 1.9% the previous month.

The ECB reduced its interest rates at the beginning of June, but suggested that it would mark a break in its softening cycle that has been going on for a year, after inflation has finally returned to its objective.

Earlier in the day, the Statistics Office had announced that inflation had a slowdown in three major German Länder in June, suggesting that national figures could also be downward.

In Bavaria, the inflation rate fell to 1.8% over one year in June against 2.1% in May, in North Westphalia Rhinelander at 1.8% after 2% a month earlier and in Lower Saxony to 2.2% against 2.3%.

In Baden-Wurtemberg, however, the inflation rate increased slightly, from 2.2% in May to 2.3% this month.

(Written by Maria Martinez, Miranda Murray and Ludwig Burger, Diana Mandia, edited by Sophie Louet and Blandine Hénault)

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