Final German July HICP inflation to confirm flash estimates at 0.1% yoy

Flash German HICP inflation remained stable at 0.1% yoy in July. The national measure softened from 0.3% yoy in June to 0.2% yoy in July. As for the components, both energy and food declined, thus pushing inflation lower in July. 

Energy inflation continued to decelerate from -5.9% yoy in June to -6.2% yoy in July, cutting 3bp from the headline figure. Food prices, which were the biggest drag, softened from 1.0% yoy in June to 0.4% yoy in July, taking away 5bp from the headline figure. 

On the core components, prices paid for services contributed the most in inflation as they increased from 0.9% yoy to 1.1% yoy in July, adding 10bp.

"Looking ahead, German HICP inflation is expected to average 0.3% in 2015 and 1.7% in 2016, while the core metric should average at 0.9% in 2015 and 1.2% in 2016", says Societe Generale.