Headline inflation in Germany in November was stronger than market expectations. The harmonized inflation rate, according to EU standards, increased to 2.6% year-on-year, exceeding analysts' forecast of 2.4%. This notable acceleration compared to the October HICP of 2.3% indicates persistent inflationary pressure in the largest European economy.
The domestic consumer price index showed a different trend, rising by 2.3% year-on-year, which was slightly below the estimated 2.4%. The CPI dipped by 0.2% on a monthly basis. The harmonised index fell by 0.5% in the month, slightly below the expected decline of 0.6%.
The unexpected rise in harmonized inflation creates uncertainty for economic planning in the eurozone. If forecasts are exceeded, investors will need to adjust their expectations for the ECB’s further policy moves, as stubborn inflation hinders rapid monetary policy easing.
