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Carsten Brzeski, Chief Economist at ING, notes that with 2.3% year on year and 2.0% in August, the German headline inflation accelerated in September to its highest level since early 2011.

Key Quotes

“The HICP inflation came in at 2.2%, from 1.9%.”

“The increase in headline inflation, however, isn’t so much the result of the ECB’s ultra-loose monetary policy but rather the result of higher energy and increased food prices in some states due to the hot and dry summer weather.”

“Today’s German inflation should further put ECB president Mario Draghi’s comments at the beginning of the week into perspective.”

“An increase in core inflation has been and currently still looks much more like wishful thinking than reality. Or to paraphrase Mario Draghi: with today’s German inflation data any pick-up in core inflation in the Eurozone still is much more relative than vigorous.”