German inflation ticks higher in February

Germany inflation unexpectedly ticked higher in February as food prices rose, according to data released on Wednesday by Destatis.

The harmonised index of consumer prices rose to 9.3% from 9.2% in January, versus consensus expectations for a fall to 9%.

Germany’s headline national inflation rate was unchanged from January at 8.7% and in line with consensus expectations. The data showed that food inflation edged up to 21.8% in February from 20.2% the month before, while energy inflation fell to 19.1% from 23.1%.

Preliminary data released on Tuesday showed that French and Spanish inflation rose in February.

Headline inflation in France ticked up to 6.2% year-over-year from 6% in January, coming in above consensus expectations of 6.1%. Meanwhile, the harmonised index came in at 7.2% in February, up from 7% the month before and above consensus expectations for no change. The jump mostly reflects higher food and services inflation.

In Spain, the headline inflation rate rose to 6.1% from 5.9% in January, with harmonised inflation coming in the same. Economists had been expecting a decline to 5.5%.

Capital Economics said: "The renewed rise in headline inflation in Germany, France and Spain in February suggests eurozone inflation edged up this month, rather than falling as had been expected.

"With signs that underlying inflationary pressures also intensified, this will keep the European Central Bank firmly in a hawkish mood."