According to preliminary data published today by Destatis for June, in Germany, the Eurozone's locomotive economy, Consumer Price Index (CPI) rose 0.4 percent compared to the previous month, in line with market expectations, and reached 2.1 percent year-over-year.


 

The highest annual increase was 9.4 percent in energy group, followed by goods' prices at 3.1 percent, according to the details of the report published by Destatis. Services took the third place with an increase by 1.6 percent and 1.3 percent increase in rents was also decisive in terms of the rise of the customer prices index in Germany.
In Europe, which has become the center of the 3rd wave of the novel coronavirus (Covid-19) outbreak, the German public authority has imposed a deflationary effect by October 2020 in order to control the outbreak, greatly shaking household consumption behavior. But the strong rise in international commodity prices, especially oil, since January has underpinned a marked increase in prices overall.
On the other hand, in German inflation, where the ultra-loose monetary policy of the European Central Bank (ECB) is effective through the domestic demand, it is possible to say that the outlook is upward in the coming data set, along with the base effect.