Brandenburg CPI

February: +0.6% m/m, +1.8% y/y
January: -0.5% m/m, +1.5% y/y
—
Hesse CPI

February: +0.6% m/m, +1.8% y/y
January: -0.5% m/m, +1.6% y/y
—
Pan-German CPI

MNI median forecast: +0.5% m/m, +2.1% y/y
MNI forecast range: +0.4% to +0.7% m/m

January: -0.4% m/m, +2.0% y/y
—

BERLIN (MNI) – January consumer prices in the eastern German state
of Brandenburg and in the western state of Hesse both rose 0.6%, the
respective state statistics offices said Friday.

The monthly CPI results in the two states were above the median
pan-German forecast of +0.5% in an MNI survey of analysts. Saxony
earlier today posted a monthly price rise of 0.5%.

Annual inflation rates in both Brandenburg and Hesse rose to +1.8%.

As in Saxony, upward pressure on monthly inflation came from food
prices, with seasonal foodstuffs rising more sharply. Annual inflation
was again marked by the upward surge of energy and food prices.

Underlying inflation remained moderate in February. CPI excluding
energy and seasonal produce rose 0.3% on the month and 0.7% on the year
in Hesse. In Brandenburg, CPI-ex seasonal food was up 0.5% and 1.6%,
respectively, and CPI-ex heating oil and motor fuel climbed 0.5% and
1.1%.

While analysts acknowledge that there exist upside risks to
inflation, they see no danger of a price-wage spiral at the moment.

Economics Minister Rainer Bruederle said earlier this week that
rising energy prices do not yet risk spawning second-round inflation
effects in Germany. “This is always a risk, but I hope that it will stay
contained,” he added.

However, Bundesbank Board member Andreas Dombret cautioned Thursday
that elevated inflation in Germany and the Eurozone might prove more
stubborn this year than initially assumed.

“Higher inflation could definitely prove more persistent than
assumed up to now,” the central banker warned. “Second-round effects
also cannot be ruled out.”

The price climate in Germany and the Eurozone has clearly worsened
due to global trends for energy, commodities and food, Dombret pointed
out.

For detailed information see data table on MNI MainWire.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

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