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German inflation eases to five-year low

Xinhua, February 12, 2015 Adjust font size:

Annual inflation in Germany fell markedly in January and dipped to a negative territory for the first time in more than five years, official data showed on Thursday.

Consumer prices in Europe's biggest economy dropped by 0.4 percent in January 2015 compared with January 2014, German federal statistical office Destatis said, attributing the drop to "the continuing downward price trend for mineral oil products".

A lower reading was last seen in September 2009, Destatis said, when the inflation measured by consumer price index (CPI) stood at minus 0.5 percent. In December last year, Germany's consumer prices increased yearly by 0.2 percent.

When measured by harmonized consumer price index (HCPI), European Central Bank's yardstick, German annual inflation in January fell to minus 0.5 percent in January, following a HCPI growth of 0.1 percent in December last year.

Falling oil prices added pressure to the already weak inflation in the euro zone. Preliminary data from the European Union's statistical office showed that inflation rate in the common currency area went down to minus 0.6 percent in January 2015 from minus 0.2 percent in December 2014.

Aiming at countering the downward trend of prices, the ECB decided last month to inject over one trillion euros (about 1.13 trillion U.S. dollars) into market by purchasing government bonds and other securities from March 2015 until September 2016.

ECB President Mario Draghi said that the program could be extended until the inflation rate in the euro zone was on a sustained path back towards the central bank's medium-term maintenance target of below, but close to 2 percent. Endi