Final German HICP inflation to confirm flash estimate at -0.2% yoy

Final German HICP is expected to remain unchanged from its flash estimate of -0.2% yoy in September, notably weaker than its August reading of 0.1% yoy. The national index also fell from 0.2% yoy to 0.0% yoy in September. As expected, the biggest drag came from the energy component on account of the drop in gasoline prices (cutting 18bp from the headline reading). The food component was the only positive contributor (adding 3bp to the headline). In core components, both prices of non-energy goods and services softened, cutting 4bp and 5bp, respectively. 

"We expect German HICP inflation to average 0.2% in 2015 and 1.2% in 2016, while the core metric should average 1.1% in 2015 and 1.3% in 2016", notes Societe Generale.