Pickup in German Inflation Affirmed, while U.S Inflation Jitters Weigh on the EUR

It was a quiet day on the Eurozone economic calendar. Finalized German inflation figures were in focus going into the European open.

In November, German consumer prices fell by 0.2%, which was in line with prelim figures. Consumer prices had risen by 0.5% in October.

Germany’s annual rate of inflation accelerated from 4.5% to 5.2%, which was also in line with prelim figures.

According to Destatis,

• The inflation rate increased for the 6^th time in a row, reaching the highest level recorded in 2021.
• A higher inflation rate was last recorded in Jun-1992, when the rate of inflation was 5.8%.
• Compared with Nov-2020, energy prices were up 22.1%, with prices for food up 4.5%.
• Excluding energy, Germany’s annual rate of inflation stood at 3.4%.
• Prices for services increased by 2.9% compared with the same month a year earlier, also exceeding the ECB’s 2%.

Market Impact

Ahead of today’s stats, the EUR had risen to a pre-stat and current day high $1.13029 before easing back.

In response today’s stats, the EUR rose to a post-stat high $1.12981 before falling to a post-stat and current day low $1.12865.

At the time of writing, the EUR was down by 0.04% to $1.12883.

Next Up

U.S inflation and consumer sentiment figures. The markets are eager to assess whether there is another spike in inflation to force the FED into action…