BERLIN: Inflation is gradually creeping higher in Germany but is still a long way off the European Central Bank’s target of just under 2 per cent.
A preliminary estimate of Germany’s EU harmonised annual inflation rate came in at 0.4 per cent for January, compared to 0.2 per cent in December. It was in line with expectations. Month on month prices dropped by 0.9 per cent, when they had remained flat at the end of 2015.
Inflation in Germany slipped in and out of negative territory during the course of last year but the annual rate has not been at or above 1 per cent since June 2014.
ECB president Mario Draghi gave a strong hint at last week’s meet of the central bank that he stood ready to press the button on more stimulus in March in an effort to boost inflation across the euro area. He earlier this week laid into critics of the bank’s quantitative easing programme, warning that the ECB’s “credibility” was at risk if it fails to drive inflation higher.
