German HICP inflation printed at 0.1% yoy in March and the rebound in consumer prices is expected to continue in April as well.Energy prices rose again during the month of April and should contribute positively to the respective component. Food- and goods prices should rise tepidly but the real contributor to the quickening of German consumer prices should come from prices paid for services due to the base effects from the Easter timing. Given that Easter fell in the first weekend of April this year, in contrast to 2014 when it took place in the middle of April, a strong quickening is expected in services prices and, logically, core inflation. “We expect German HICP inflation to average 0.5% in 2015 and 1.8% in 2016, while the core metric should remain stable at 1.2% in 2015 and 1.5% in 2016”, says Societe Generale
The material has been provided by InstaForex Company – www.instaforex.com