Germany's annual Consumer Price Index (CPI) inflation increased to 3.3% (preliminary) in September, up from 2.9% in August, according to data released by Germany's Destatis on Wednesday [1]. On a monthly basis, the CPI rose by 0.6%, following a 0.2% increase in August, and exceeded the market expectation of a 0.5% rise [1].
The Harmonized Index of Consumer Prices (HICP), which is the European Central Bank's (ECB) preferred measure of inflation, also climbed by 0.6% month-on-month and 3.3% year-on-year in September. Both figures surpassed analysts' estimates [1].
Despite the higher-than-expected inflation data, the EUR/USD currency pair showed no immediate reaction and was last seen trading near 1.1350, up about 0.1% on the day [1]. The article notes that higher inflation typically leads central banks to raise interest rates, which can strengthen the currency, but in this instance, the market response was muted [1].
No forward-looking statements or analyst opinions were provided in the article.
CONCLUSION
Germany's inflation figures for September came in above expectations, with both the CPI and HICP rising to 3.3% year-on-year. Despite the stronger inflation data, the immediate market reaction was limited, as reflected in the modest movement of EUR/USD.