The preliminary data for November on the consumer price index in Germany shows a trend variation of 10.0%, a slowdown compared to the 10.4% recorded in October.
This was revealed by the Federal Statistical Office (Destatis), signaling an economic downturn of 0.5% compared to +0.9% in the previous month. The Bloomberg consensus indicated an annual change of 10.4% and a monthly decrease of 0.2%, respectively.
On a harmonized basis, consumer prices show a trend increase of 11.3% (in line with the consensus, +11.6% in October) and a stable reading on a monthly basis (estimated +0.1%, +1 .1% in October).
“Energy and food prices, in particular, have risen considerably since the start of the war in Ukraine and have had a substantial impact on the inflation rate,” explains Destatis. “In November 2022, food prices recorded above-average growth (+21%) compared to the same month of the previous year. Conversely, energy prices have declined slightly, but are still 38.4% higher than in the same month of 2021.”
“Looking forward, November may not yet represent the peak of German inflation,” says Carsten Brzeski, Global Head of Macro at ING. In light of the “ongoing wholesale gas price pass-through” and “still high selling price expectations, we expect inflation to rebound in December, before finally reaching a more structural peak in Q1 2023.” For the ECB, however, “today’s data on German and Spanish inflation could be enough to justify a rate hike of 50 basis points and 75 points at the December meeting”.