German inflation slows more than expected in April

Headline inflation declined to 7.2% from 7.4% in March, versus expectations for a drop to 7.3%.

Meanwhile, HICP inflation fell to 7.6% in April from 7.8% in March, compared to consensus expectations of 7.7%.

Capital Economics said: "The limited breakdown available for Germany shows that, as was the case in France and Spain, CPI energy inflation rose sharpy, from 3.5% to 6.8%. The main reason for the decline in the headline rate was a sharp drop in food inflation, from 22.3% to 17.2%."

The core rate will only be included in the final release, but Capital Economics said it probably held steady at 5.7%.

"Indeed, we estimate that core CPI goods inflation rose from 7.1% to 7.3%, offsetting the slight decline in services inflation from 4.8% to 4.7%. That chimes with figures from France, which suggest that core CPI inflation there also rose as an increase in services inflation more than offset a drop in core goods inflation. Taken together, our estimates for core CPI inflation in the two countries point to a slight increase in the euro-zone core rate in April, perhaps from 5.7% to 5.8%."