German regional CPI numbers drop in December 2017

The only data left today is German inflation for Dec. The regionals have been out and here’s the results (all y/y);

  • Saxony 1.7% vs 2.0% prior
  • Hesse 1.7% vs 2.0% prior
  • Bavaria 1.7% vs 1.8% prior
  • North Rhine 1.5% vs 1.8% prior
  • Baden W 1.8% unch

That’s a sizeable drop in some but it is a bit of a reversal from a strong jump we saw last month. The euro has pretty much ignored the numbers, and that’s mostly because the market was/is expecting a softer month anyway. The main German number is out at 13.00 GMT and HICP is expected in at 1.4% vs 1.8% prior, with CPI expected at 1.5% vs 1.8% prior. The HICP number looks a little too wide at a 4pp change so keep an eye out if it comes in above. I’d paint it more at 1.5%, though I’m not sure there’s many traders trading the data anyway.

Update: Here’s the headline numbers out at 13.00 GMT;

  • CPI 1.7% vs 1.5% exp y/y. Prior 1.8%
  • HICP 1.6% vs 1.4% exp y/y. Prior 1.8%

So as I thought above, not as weak as expected. EURUSD still can’t breach 1.20 though.

Ryan Littlestone

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