By Maria Martinez
Germany's annual rate of inflation rose strongly in December, beating forecasts and posting its highest reading since the summer of 1992, according to preliminary data released by the German statistics office Destatis on Thursday.
Consumer prices rose 5.3% on year measured by national standards, above the 5.1% forecast by economists polled by The Wall Street Journal. They rose 5.7% on year by European Union-harmonized standards, above the economists' forecast of 5.6%.
The increase in the inflation rate was caused mainly by base effects due to lower prices in 2020, the statistics office said. In this context, the temporary reduction in the value added tax and the sharp decline in mineral-oil product prices also had an upward effect on the overall inflation rate, Destatis said.
Additional factors included the introduction of carbon-dioxide pricing in January and pandemic-related effects, such as marked price increases as the economic recovery got underway, the statistics office said.
Consumer prices rose 0.5% on month by national standards, more than the 0.3% increase forecast by economists polled by the WSJ. Prices increased by 0.3% by EU-harmonized standards, also more than the 0.2% forecast by the economists.
Final results will be released on Jan. 19.
Write to Maria Martinez at firstname.lastname@example.org
(END) Dow Jones Newswires