Fabio Fois at Barclays writes that the...>

DATA REACT: Fabio Fois at Barclays writes that the German HICP print was "at

odds with indication provided by state CPI data. At this stage it is difficult

to identify the exact reason. We believe that a potential source of discrepancy

could be different CPI and HICP weighting of some seasonal dependent components

such as package holiday, hotels and non-energy industrial goods prices

(ex-health) which came in on the weak side."

- Tomorrow will see the release of Eurozone HICP and the German data will

depress expectations for this release. Barclays forecast (at 2DPs),"headline to

print 1.16% and core 0.95%. Underpinning our forecast is the expectation that

Spanish and French inflation (also to be released tomorrow) will decline to 1.1%

(from 1.2% in December) and to 0.5% (from 1.2%), respectively."