All German flash inflation indicators for February fell short of expectations. Germany’s Consumer Price Index (CPI)  rose by 12.%. It was expected to record a year over year rise of 1.3% in February, like in January. Month over month, prices rose 0.5%, and they expected to rise by 0.6% after a drop of 0.6% beforehand. The harmonized figure rose 0.5% and it was expected to rise 0.7% m/m after -0.7% beforehand and 1.1%. The yearly HICP fell from 1.2% to 1%, below 1.1% expected. Early releases from the various German states came out below expectations. The yearly figures are more important for the ECB. This implies a weaker euro-area CPI tomorrow.
EUR/USD was trading steadily at 1.3655, getting used to the low ground it dropped to as the crisis in the Ukraine aggravated and as US data came out better than expected. The pair is marginally weaker. It seems that the early releases from the states already lowered expectations.
More data: goods price rises fell to 0.6% from 0.8%. Energy inflation is digging deeper in lower ground at -2.7% after 1.8% beforehand.
The flash figures for Germany precede the flash figures for the whole euro-zone for February, which are due tomorrow. They have a critical impact on the ECB’s decision in March.
See how to trade the EZ CPI with EUR/USD.
Will Mario Draghi announce a negative deposit rate in March?
