By Tyler Durden
Following a series of “hot” inflation prints from Germany’s states, moments ago German inflation rose more than expected, printing at 2.2% above the 2.1% consensus estimate, up from 1.9% in January and surpassing the ECB’s target of a rate just under 2 percent for the first time in more than four years.
With Germany headed for federal elections in September, the inflation figures will add more fuel to the debate about an end to the European Central Bank’s loose monetary policy.
Earlier on Wednesday, preliminary data from several German states showed that consumer price inflation accelerated across the country, mainly driven by higher food, energy and transportation costs. In the most populous state, North Rhine-Westphalia, annual inflation rose to 2.3 percent from 1.9 percent in January. It reached 2.5 percent in Hesse, 2.2 percent in Baden-Wuerttemberg, 2.1 percent in Bavaria, 2.0 percent in Brandenburg and 2.4 percent in Saxony.
The state readings, which are not harmonised to compare with other euro zone countries, fed into the just as hot nationwide inflation print released moments ago.
Yet not everyone was convinced Germany’s blistering headline inflation would be a hindrance to the ECB. Cited by Reuters, Capital Economics analyst Jennifer McKeown …read more