In Germany, annual inflation fell to 1.6% in September, influenced by tight monetary policy. This figure was significantly below the European Central Bank’s 2% target. Expectations for a rate cut from the ECB in October also strengthened.
In Germany, annual inflation fell to 1.6% in September due to tight monetary policy and economic uncertainty. This meant that inflation in the country fell well below the European Central Bank’s (ECB) target of 2%. The German Federal Statistical Office (Destatis) released preliminary data on consumer price increases for September. Accordingly, annual inflation in Germany, which was 1.9% in August, fell to 1.6% in September. This marked the lowest annual inflation in the country since January 2021. Market expectations were for inflation to drop to 1.7% in September. The inflation rate in the country remained unchanged on a monthly basis.
STRONG SIGNALS FOR RATE CUT
Data from Germany, the largest economy in Europe, strengthened expectations for a rate cut at the ECB’s meeting in October. On September 12, the ECB lowered deposit interest rates by 25 basis points, the main refinancing rate and marginal lending rate by 60 basis points, in line with market expectations for the second rate cut of the year. The ECB targets 2% inflation in the medium term. Eurostat, the European statistics office, will announce the Eurozone inflation rate for September tomorrow.