MNI Projects CPI to Cool to +8.55% y/y in December

We have now received state data that equates to 88.1% weighting of the national German CPI print.

• MNI calculations estimate that CPI fell -0.82% m/m, which would be equivalent to a +8.55% y/y increase. This is based on the published index values for available state data.
• The Bloomberg consensus is for inflation to remain more elevated, falling at a softer -0.6% m/m to hover around a higher +9.0% y/y. This implies a 1.0pp deceleration on the annualised figure, as German headline inflation distances itself further from the October peak of +10.4% y/y.
• Note: this is 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.
• This data alongside the downside surprise in Spanish flash data adds to evidence that a softer-than-expected December HICP for the eurozone aggregate is likely. Consensus is currently looking for -0.1% m/m and +9.5% y/y.

• Y/Y	Dec (Reported)	Nov (Reported)	Difference	Weighting
  North Rhine Westphalia	8.7%	10.4%	-1.7%	21.70%
  Hesse	8.1%	9.7%	-1.6%	7.70%
  Bavaria	9.2%	10.9%	-1.7%	16.80%
  Brandenburg	9.1%	10.5%	-1.4%	2.60%
  Baden Wuert.	8.5%	9.6%	-1.1%	14.10%
  Berlin	7.9%	9.1%	-1.2%	3.90%
  Saxony	8.7%	9.9%	-0.2%	4.40%
  Rhineland-Palatinate	8.4%	9.8%	-1.4%	5.10%
  Lower Saxony	8.3%	10.0%	-1.7%	9.40%
  Saxony-Anhalt	8.7%	10.5%	-1.8%	2.40%
  Weighted average:	8.55%	for	88.1%
  M/M	Dec (Reported)	Nov (Reported)	Difference	Weighting
  North Rhine Westphalia	-1.0%	-0.8%	-0.2%	21.70%
  Hesse	-0.7%	0.4%	-1.1%	7.70%
  Bavaria	-1.1%	-0.3%	-0.8%	16.80%
  Brandenburg	-0.6%	-0.5%	-0.1%	2.60%
  Baden Wuert.	-0.4%	-0.2%	-0.2%	14.10%
  Berlin	-0.6%	-0.9%	0.3%	3.90%
  Saxony	-0.6%	-0.3%	-0.3%	4.40%
  Rhineland-Palatinate	-0.7%	-0.2%	-0.5%	5.10%
  Lower Saxony	-0.9%	-0.6%	-0.3%	9.40%
  Saxony-Anhalt	-1.1%	-0.3%	-0.8%	2.40%
  Weighted average:	-0.82%	for	88.1%