Danish Inflation YoY likely to rise in H2 2016

Danish December Inflation was posted at 0.5%, well above consensus and Nordea Bank's forecast of 0.3% and is expected to grow from next month onwards, driven by diminishing base effects from lower energy prices.

The current unusual low inflation in Denmark is the result of low oil prices, which together with heating energy subtracted over 0.5 %-points from the YoY figures in December. Major contribution to the overall Inflation was made by housing rents and misc. goods and services, as they contributed 0.4 % and 0.30% points respectively.

"If the current low price level in oil persists the headline inflation will rise less than previously expected. The expected increase in the year-over-year inflation will mainly take place in the second half of 2016" - Nordea Bank