German Inflation Accelerates Further, Registering 2.0% Y/Y in April

29 April 2021

By David Barwick – FRANKFURT (Econostream) – Consumer prices in Germany accelerated for the fourth month in a row in April, growing at an annualized 2.0%, according to the flash estimate of the German Federal Statistical Office on Thursday.

The increase represented a renewed acceleration of prices after readings of 1.7% in March, 1.3% in February and 1.0% in January were preceded by negative readings in each of the last four months of last year. On the month, German CPI in April came in at 0.7%.

On a harmonized basis, the flash estimate of German inflation was higher yet, at 2.1%, as compared to the ‘below, but close to, 2%’ threshold for price stability used by the European Central Bank.

‘In the second half of the year, high HICP rates can then be expected temporarily due to the base effect of the VAT cut in the previous year’, the German Bundesbank has made clear. ‘From today’s perspective, they could clearly exceed 3% at times by the end of the year.’

The Statistical Office will release final figures for April on May 12.