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German inflation slows sharply to 1.7 percent in December

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By Reuters
German inflation slows sharply to 1.7 percent in December
FILE PHOTO: The 'Europacity' construction site is pictured in Berlin, Germany, July 27, 2018. REUTERS/Fabrizio Bensch   -   Copyright  FABRIZIO BENSCH(Reuters)

BERLIN (Reuters) – German annual inflation slowed sharply in December, slipping below the European Central Bank’s target level just as it ended a crisis-fighting bond purchase scheme after four years and as global markets slumped.

German consumer prices, harmonised to make them comparable with inflation data from other European Union countries, rose by 1.7 percent year-on-year after an increase of 2.2 percent in the previous month, the Federal Statistics Office said on Friday.

The ECB targets inflation of close to but below 2 percent for the euro zone as a whole. December’s weaker German annual inflation rate was marked by a pronounced slowdown in energy price rises.

On the month, EU-harmonised prices rose by 0.3 percent, the preliminary numbers showed, compared with the forecast for a 0.4 percent increase.

(Writing by Paul Carrel; Editing by Maria Sheahan)