EUROPEAN INFLATION
German final December HICP was unrevised from the flash readings at 2.8% Y/Y (2.4% prior) and 0.7% M/M (-0.7% prior). The final reading of CPI was also unrevised on the yearly measure at 2.6% Y/Y (2.2% prior), while the sequential reading was upwardly revised by 0.1pp to 0.5% M/M, contrary to MNI's expectations based on state-level data (-0.2% prior). Core CPI printed at 3.3% Y/Y (also upwardly revised, 3.1% flash, 3.0% prior), the highest rate since March 2024.
- Overall, the data suggests that while around half of the 0.4pp acceleration came from energy, higher inflation was also seen in a wider set of categories, with the goods contribution rising overall by 0.34pp vs Nov, and services contributing 0.04pp more than previously. MNI's inflation breadth tracker (see next bullet) supports this view.
- On the 0.16pp contributions increase in the transport category, 0.13pp came from car fuel. The 0.09pp higher contribution in the recreation and culture category was broad-based within the respective subcategories, although this category was seasonally soft in December 2023 so looks at least partially to be reflecting base effects.
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