German inflation at 2.0% in January: statistics

11th February 2011, Comments 0 comments

German inflation rose to 2.0 percent in January, the national statistics office said Friday, revising higher an earlier estimate of 1.9 percent for the biggest economy in Europe.

Energy costs were again the main factor for higher prices across the board, and when they were stripped out of the calculation inflation came in at a much more tame 1.1 percent, the Destatis data showed.

Inflation has thus reached a threshold "which is important for monetary policy," a Destatis statement said.

The European Central Bank has set a medium-term inflation target of below but close to two percent for the entire 17-nation eurozone.

Strengthening inflation in the bloc's economic locomotive will once again be mulled by the ECB governing council when it makes its next interest rate decision in early March.

The council believes that eurozone inflation, which hit 2.4 percent in January according to European Union data, will ease later this year, which is when economists expect the bank's current record low rate of 1.0 percent to begin to rise.

© 2011 AFP

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