After what has been a continued decline in inflation all through last year, the next reading today is expected to see German consumer prices tick a little higher. That comes as we now move past some base effects and focus more on price developments in the last 12 months instead. Although, this month's bump could still be in part due to energy prices.
The headline reading is expected to tick higher to 3.7%, up from 3.2% in November. Meanwhile, the EU-harmonised reading is expected to jump to 3.8%, up from 2.3% in November.
While this may keep the ECB on their toes, I think that there is still a distinct lack of appetite for policymakers to change up the narrative for now. They are in pause mode and will continue to preach such a stance, with one eye already on rate cuts for the months ahead. And I would assume markets have the same thinking. As such, any pop in the euro on the numbers are likely to be faded.
Here's the agenda for today:
- 0630 GMT - North Rhine Westphalia
- 0900 GMT - Hesse
- 0900 GMT - Bavaria
- 0900 GMT - Baden Wuerttemberg
- 1000 GMT - Saxony
- 1300 GMT - Germany national preliminary figures
Do note that the releases don't exactly follow the schedule at times and may be released a little earlier or later.
