MNI Sees Small Upside Risks To German National CPI Following State Data

We have now received state data that equates to 86.7% weighting of the national January flash German CPI print (due at 13:00 BST / 14:00 CET). MNI estimates that national CPI (non-HICP print) rose by +0.1-0.2% m/m and 2.9% y/y.

• This is based on the published index values for available state data. The data implies readings slightly below consensus on an annual basis (with the Bloomberg consensus coming into the session at +3.0% Y/Y). However, the M/M reading appears to have upside risks to the Bloomberg consensus of +0.1% M/M.
• How can we look for a softer Y/Y print but a firmer M/M print? Looking more into the Bloomberg survey data there are 16 analysts who forecast both M/M and Y/Y and a further 7 analysts who forecast only Y/Y. If we take only the analysts who forecast both, the median of their forecasts is 2.85%Y/Y (mean 2.89%) with median 0.1%M/M (0.14%M/M mean). So our 2.90%Y/Y and +0.18%M/M calculations see small upside risks to both the M/M and Y/Y prints from this sub-section of the survey.
• Today's state data points to core CPI (ex-energy and food) of roughly 3.3-3.4% Y/Y, vs 3.5% in January. Core CPI data is only available for 6 states accounting for 50% of the national index so this is a rough estimate, but the direction vs December's reading seems downward.
• 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.