German producer price index rises at subdued rate in August

The German producer price index for industrial products rose at a weaker pace in August. On a year-on-year basis, the producer price index rose 0.3 percent, a slowdown from prior month’s 1.1 percent. On a sequential basis, the overall index dropped 0.5 percent in the month, as compared with July’s rise of 0.1 percent.

The greatest effect on the growth of the overall index compared to August 2018 had the development of electricity prices. These rose 6 percent year-on-year, whereas dropped 1.1 percent on a sequential basis. Energy prices as a whole dropped 0.3 percent year-on-year and 1.6 percent sequentially. Prices of natural gas dropped 5 percent year-on-year and prices of petroleum products dropped 5.7 percent. The overall index excluding energy came in at 0.6 percent year-on-year, whereas it stayed the same on a sequential basis.

Non-durable consumer goods prices rose 1.7 percent year-on-year in August, whereas it was up 0.1 percent sequentially. Food prices rose 2.2 percent. Particularly high was the rise of prices of meat of swine and of processed and preserved potatoes. On the contrary, prices of butter dropped 32.9 percent year-on-year and prices of sugar fell 14.8 percent. Prices of coffee dropped 6.5 percent. Prices of capital goods was up 1.5 percent, whereas prices of durable consumer goods rose 1.3 percent.

Intermediate goods’ prices dropped 0.9 percent year-on-year and 0.2 percent sequentially. Prices dropped especially in electronic integrated circuits and metallic secondary raw materials. Metal prices dropped 2.6 percent year-on-year, while prices of basic iron, steel and ferron-alloys fell 5.1 percent. On the contrary, prices of precious metals rose 22.7 percent year-on-year. Prices of articles of concrete, cement and plaster rose 4.7 percent.