Mixed German CPI Inflation Figures Leave the Euro Down

• Bavaria: July CPI increased by 2.5% year-on-year, down from 2.7% in June.
• Brandenburg: CPI remained steady at 2.6% year-on-year.
• Hesse: CPI also held steady at 1.8% year-on-year.
• Saxony: CPI rose to 3.1% year-on-year, up from 2.8% previously.
• North Rhine Westphalia: CPI increased to 2.3% year-on-year, compared to 2.2% prior.
• Baden Wuerttemberg: CPI edged up to 2.1% year-on-year, from 1.9% previously.

The data presents a mixed picture, but overall it suggests the national CPI reading could come in around 2.3% or even 2.4%, slightly higher than expected. Attention will be particularly focused on the core inflation figure.

Spanish CPI Inflation Data – 30 July 2024

• CPI (July, Preliminary): +2.8% year-on-year, compared to +3.0% expected
  • Previous: +3.4% year-on-year
• HICP: +2.9% year-on-year, against +3.2% expected
  • Previous: +3.6% year-on-year

The inflation readings are lower than forecasted, indicating that Spanish headline inflation has been fluctuating over the past six months. Core annual inflation, which excludes volatile items like food and energy, has eased to 2.8%, down from 3.0% in June. This reduction provides some relief for the European Central Bank (ECB), but the figures are still not at the desired level for the ECB’s targets.