EURO: German Inflation Hits Lowest Since 2021
The German CPI data for the month of March came at 2.3% it is the lowest level since June 2021, 2.7% printed in February, 3.1% in the March month. The ECB have possible rate cut in the June month is more expected from economists after the Major industrial hub of Euro- zone Germany Economy fell down in inflation towards 2% target. Euro currency down against USD after the data printed today.
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In March, German inflation followed a downward trajectory, matching the lowest level recorded since mid-2021, as indicated by secondary estimates released on Friday by the Federal Statistical Office, Destatis.
According to the harmonized index of consumer prices, inflation rose by 2.3% year-on-year last month, consistent with both the preliminary estimate and analysts’ projections. This figure represented a decrease from February’s 2.7% and January’s 3.1%, aligning with November’s reading, which stood as the lowest level since June 2021.
The decline in the harmonized inflation rate, which utilizes the same methodology applied in other EU countries to ensure equitable comparisons among member states, was primarily driven by a 2.7% year-on-year decrease in energy prices and a 0.7% decline in food prices. Notably, March marked the first instance since February 2015 that food prices exhibited a year-on-year decline, as highlighted by Destatis.
Core inflation, excluding food and energy prices, was confirmed at 3.3% in March, moderating slightly from February’s 3.4%.
EURO: German Inflation Hits Lowest Since 2021
The German CPI data for the month of March came at 2.3% it is the lowest level since June 2021, 2.7% printed in February, 3.1% in the March month. The ECB have possible rate cut in the June month is more expected from economists after the Major industrial hub of Euro- zone Germany Economy fell down in inflation towards 2% target. Euro currency down against USD after the data printed today.
EURCHF has broken Ascending channel in downside
European stocks surged on Friday following indications from a European Central Bank (ECB) poll suggesting that inflation in the eurozone could stabilize at 2 percent in the long term, potentially paving the way for an interest rate cut in June.
Additionally, positive regional economic data contributed to the bullish sentiment. Germany reported a slowdown in consumer price inflation to 2.2 percent in March, aligning with earlier flash estimates and marking the weakest inflation rate since May 2021. France also saw a moderation in consumer price inflation to 2.3 percent in March, in line with previous estimates.
Meanwhile, the UK’s real GDP edged up by 0.1 percent in February, consistent with market expectations and indicating a continuation of modest economic growth.
In response to these developments, the pan-European STOXX 600 index surged by 1.1 percent to reach 510.25, rebounding from a 0.4 percent decline in the previous session. Major European indices followed suit, with Germany’s DAX climbing by over 1 percent, France’s CAC 40 rising by 1.1 percent, and the UK’s FTSE 100 advancing by 1.3 percent.
Key movers in the market included BP Plc and Shell, which both gained as Brent crude futures surpassed $90 a barrel amid speculation about potential geopolitical tensions involving Iran. Mining companies such as Anglo American, Antofagasta, and Glencore also saw significant gains as base metals prices rallied on supply concerns and improving demand prospects.
In the financial sector, Societe Generale saw a notable increase of 4.7 percent after announcing a deal to sell its professional equipment financing business. ThyssenKrupp AG shares surged nearly 3 percent following the company’s announcement of a structural realignment in its loss-making Steel division.
Overall, positive economic data and optimism about potential monetary policy adjustments drove the bullish momentum in European stock markets on Friday.
EURO: German inflation hits near 3-year low, sparking confidence in ECB rate cut
The German CPI data for the month of March came at 2.3% it is the lowest level since June 2021, 2.7% printed in February, 3.1% in the March month. The ECB have possible rate cut in the June month is more expected from economists after the Major industrial hub of Euro- zone Germany Economy fell down in inflation towards 2% target. Euro currency down against USD after the data printed today.
EURCAD is moving in box pattern and market has fallen from resistance area of the pattern
The final statistics from the German Federal Statistical Office, released on Friday, revealed a notable slowdown in Germany’s inflation rate in March. Driven by declining energy and food prices, the inflation rate dropped to 2.3%, marking its lowest level since June 2021. This decline instilled growing confidence among market participants that the European Central Bank (ECB) would consider cutting interest rates. Notably, the inflation indicators adjusted by the EU illustrated a 2.7% year-on-year increase in consumer prices in Germany for February.
Regarding core inflation, excluding volatile food and energy prices, Germany witnessed a rate of 3.3% in March, representing the lowest level since June 2022 and a slight decrease from February’s 3.4%. The ECB closely monitors core inflation to gauge the depth and persistence of price pressures. The monthly Consumer Price Index (CPI) remained steady, rising by 0.4%, consistent with previous data.
Ruth Brand, the president of the German Statistical Office, noted that March 2024 saw consumers facing lower food prices compared to the previous year, marking the first such occurrence since February 2015. Food prices in Germany declined by 0.7% year-on-year in March. Similarly, energy prices experienced a significant drop of 2.7% compared to the same period last year, contributing to the overall decline in inflation.
However, the deceleration of core inflation in Germany appeared gradual. The service sector exhibited an upward trend, driven by sharp increases in local wage costs and rising rents. Service prices in Germany surged by 3.7% year-on-year in March, with rents rising by 2.1%, influencing the country’s service inflation rate.
Despite the notable rise in service prices, the overall commodity prices in Germany increased by only 1.0% year-on-year in March, considerably lower than the overall inflation rate.
In response to these developments, the ECB signaled a potential interest rate cut amid declining inflation in the Eurozone. While the US experiences signs of secondary inflation and resilient GDP growth, the ECB faces minimal inflation concerns, with the Eurozone’s inflation rate slightly lower than anticipated at 2.4%. The ECB’s statement emphasized that if the assessment of inflation prospects strengthens confidence in sustained progress toward the target, a reduction in monetary policy restrictions may be appropriate.
It’s noteworthy that the ECB’s recent statement did not directly mention language related to easing monetary policy, indicating a potential shift in its approach.
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