German wholesale price deflation eases

Producer-price deflation in Germany softened in May to its lowest level in 11 months, according to data out on Thursday from the Federal Statistical Office, Destatis.

The producer price index (PPI) fell at an annual rate of 2.2% in May, following a 3.3% drop in April. The consensus forecast was for a decline of 2.0%.

Producer prices have been falling year-on-year since July 2023, though last month's decline was the lowest rate in the current cycle.

Lower energy prices continued to be the main factor for overall deflation, falling 6.4% on last year on the back of falling prices for natural gas (-1.35) and electricity (-11.3%).

Excluding energy prices, the PPI would have been unchanged from May 2023.