MNI Projects 2.2% National CPI Y/Y, Core CPI Disinflation

From state-level data that equates to 89.1% weighting of the national April flash German CPI print (due at 13:00 BST / 14:00 CET), MNI estimates that national CPI (non-HICP print) rose by 0.4-0.5% M/M (March: 0.4%) and 2.2% Y/Y (March 2.2%).

• Analyst consensus currently stands at 0.6% M/M and 2.3% Y/Y so this would represent a softer reading than had been expected.
• Current tracking of core CPI (ex-energy and food, based on 50% of the national index) implies 3.0% Y/Y (vs 3.4% in February) and 0.3% M/M, per our calculations. Risks appear to lie slightly on the downside of this, (i.e. 2.9% Y/Y), though there is less confidence on this front than usual due to the distortions created by the shifting of the Easter holiday into March this year.
• A reminder that coming into today's release, analysts noted that an electricity VAT increase from 7% to 19% will have put upside pressure on the headline rate (this appears to have played out to some extent though perhaps not quite as much as had been expected), while a reversal of March Easter effects was expected to potentially drag the core rate lower, particularly in services.
• We will provide a follow-up bullet looking at underlying drivers in due course.
• This is based on the published index values for available state data. The data implies readings slightly below consensus on an annual basis
• Note: These estimates are in relation to the national CPI print, not the HICP print which feeds into the Eurozone HICP print that the ECB targets. The magnitude of surprises to consensus can sometimes be different due to the different methodologies and weights used in national CPI vs HICP - but the direction of the surprise is normally the same.