German inflation nudges lower in April
By Abigail Townsend
Date: Wednesday 10 May 2023
(Sharecast News) - German inflation edged lower in April, official data confirmed on Wednesday, although high food prices kept it from falling further.
According to Destatis, the Federal Statistical Office, the consumer price index was 7.2% on the same month a year earlier in April, compared to a 7.4% rise in March. The result confirmed Destatis's initial flash estimate, in line with consensus.
The annual harmonised index of consumer prices was 7.6%, a 0.2 percentage point decline on March, and also in line with the first estimate and consensus. All European Union countries used the same methodology to calculate HICP.
Month-on-month, inflation nudged 0.4% higher.
Energy prices were 6.8% higher in April, a notable jump on March's 3.5%. But food prices were the biggest driver of inflation, up 17.2%, although that was less than the 22.3% hike seen in March.
Ruth Brand, president of the Federal Statistical Office, said: "The rate of inflation has slowed for the second month in a row, but remains at a high level.
"Looking at the basket of goods and services surveyed, food prices continued to be the biggest driver of inflation in April."
Core inflation, which strips out the more volatile food and energy elements, was 5.8%, unchanged on March.
Claus Vistesen, chief Eurozone economist at Pantheon Macroeconomics, said: "The rebound in energy inflation was driven mainly by shifts in base effects after last year's volatility in the wake of Russia's invasion of Ukraine; it is not the beginning of a sustained upturn in energy inflation.
"Looking ahead, we still think that core inflation will come down sharply towards the end of the year, but we won't see any signs of this until the end of the third quarter. Base effects from last year's temporarily-reduced rail fare will keep services and core inflation elevated from June through August."
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