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German Inflation Slowdown in January Highlights ECB Dilemma

Consumer prices rise annual 1.4% vs estimated 1.6% gain
Eurostat will release euro-area inflation data on Jan. 31

Bloomberg business news — The subdued inflation outlook means the ECB can "lean back," Berenberg’s Holger Schmieding says.Source: Bloomberg

By

Piotr Skolimowski

January 30, 2018, 1:03 PM UTCUpdated onJanuary 30, 2018, 1:25 PM UTC

German inflation unexpectedly slowed for a second month in January, highlighting the challenge the European Central Bank faces as it gauges when it can start unwinding stimulus. The euro dropped.

Consumer prices rose an annual 1.4 percent, the Federal Statistics Office said on Tuesday. That’s less than the 1.6 percent increase recorded in December and the median estimate in a Bloomberg survey. Prices fell 1 percent from December.