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Prices in Germany fell to negative territory on all accounts: national CPI is down 1% m/m and 0.3% y/y. EU standard HICP fell 1.3% m/m and 0.5% y/y. While this is mostly due to oil prices, the deep falls  more than justify the ECB’s QE that Germany was opposed to.

EUR/USD is struggling around 1.13.

This is the first y/y fall since 2009. The numbers are 0.2-0.3% below the already low expectations. If this persists, the chances of the ECB exiting QE in September 2016 are very low.

Germany was expected to report a drop in prices both on a month over month level and on a year over level. National CPI was predicted to drop 0.8% m/m and 0.1% y/y. The European standard HICP carried predictions of -1% m/m and -0.2% y/y.

EUR/USD traded just around 1.13 towards the publication.

Releases from the various  German states were more or less in line with such expectations.

While the QE cat is already out of the ECB’s sack, the fresh inflation figures from the biggest country in the euro-area certainly has an impact on the common currency.

Earlier, we had solid data from the euro-zone and from Germany.

More:  EUR/USD Correction Drawing To A Close: Levels & Targets – BofA Merrill