German Inflation Steady At 2.3% In February

(RTTNews) - Consumer price inflation in Germany was unchanged in February, while the core price growth slowed as the cost of food increased strongly, preliminary data from the statistical office Destatis showed on Friday.

The consumer price index rose 2.3 percent year-on-year, same as in January. The CPI rose 0.4 percent from the previous month, when it fell 0.2 percent. Both figures matched economists' expectations.

"Together with French and Italian inflation data, German inflation numbers should pave the way for a rate cut next week by the European Central Bank," ING economist Carsten Brzeski said.

The core CPI that excludes food and energy prices rose 2.6 percent annually in February, which was slower than the 2.9 percent increase in January.

"Companies are obviously finding it more difficult to pass on the continued sharp rise in wage costs to their customers," Commerzbank economist Ralph Solveen said. "As a result, core inflation is likely to continue easing slowly in the coming months, although it is unlikely to fall below 2 percent."

Food inflation accelerated sharply to 2.4 percent from 0.8 percent. Services inflation slowed to 3.8 percent from 4.0 percent. Energy prices continued to fall in February, down 1.8 percent after a 1.6 percent slump in January.

The harmonized index of consumer prices rose 2.8 percent in February, same as in January. Economists had forecast 2.7 percent increase.

The EU measure HICP climbed 0.6 percent from the previous month, when it fell 0.2 percent. Economists were looking for a 0.5 percent gain.