Berlin, Germany (4E) – Inflation rate in Germany was held to its lowest level in three months in September, helping Europe’s biggest economy increase its domestic consumption.
On an annual basis, the nation’s inflation rate fell for the second month to 1.4 percent in September from 1.5 percent reading in August, and below economists’ estimate of 1.5 percent. August consumer prices remained unchanged from the previous month.
This week, the Bundesbank said declining prices will spur “extraordinarily good” consumer climate in the country. Inflation in the 17-nation euro zone – Germany’s largest trading partner – is estimated to stay mute amid gradual economic rebound, according to the European Central Bank.
Energy prices, which include cost of household energy and fuels, fell 0.2 percent in September from a year ago. Food price inflation continues to be high, though it eased to 4.7 percent in September from 4.9 percent in August, after climbing to 5.7 percent in July, a five-year high.
In European Union harmonized terms, German consumer prices remained steady on the month and rose 1.6 percent from the previous year.
Germany’s near two-decade low unemployment rate and the euro area’s emergence from its longest-ever recession has helped the economy. That has propelled Angela Merkel’s Christian Democrats to victory in the Sept. 22 vote and set her up for a third term as German leader.