German producer prices fall sharply

German producer prices fell sharply in December, office data showed on Friday, by more than expected.

According to Destatis, the Federal Statistical Office, producer prices of industrial products were 8.6% lower year-on-year last month, compared to November’s 7.9% decline.

Analysts had been expecting an 8% decline.

Month-on-month, producer prices dropped 1.2%, considerably larger that the 0.4% decline forecast.

On an annual average basis, prices were 2.4% lower in 2023 compared to 2022.

Destatis noted: "Lower energy prices continued to be the main reason for the year-on-year decline in producer prices.

"Intermediate goods were also less expensive than in December 2022, while higher prices had to be paid for consumer and capital goods."