MNI Projects National Nov CPI Soft At 3.2-3.3% Y/Y, Core 3.7%

We have now received state data that equates to 86.7% weighting of the national November flash German CPI print (due at 1300 BST / 1400 CET).

• MNI calculations estimate that national CPI fell by -0.38% m/m and rose by 3.21% y/y. This is based on the published index values for available state data. The data implies readings softer than expectations coming into the session (of 3.5% Y/Y and -0.1% M/M).
• Today's state data points to core CPI (ex-energy and food) of roughly 3.7% Y/Y, vs 4.3% in September. Core CPI data is only available for 6 states accounting for 50.0% of the headline index so this is a rough estimate.
• A key expected driver of November disinflation was the higher weighting of package holidays this year in the German inflation basket (3.5% in 2023 vs 1.2% in 2022) combining with the expected usual sharp M/M seasonal drop. MNI's estimates of the recreation and culture CPI component is around 3.8% Y/Y (vs 5.4% prior). The services component currently tracks around 3.0-3.1% Y/Y (vs 3.9% prior).
• 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.