German inflation slows in May to 2.3%

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German inflation slowed to 2.3 percent in May, compared to 2.4 percent in April, the national statistics office said Friday citing a provisional figure.

The yearly rate remains however above the 2.0-percent level which it initially hit in January.

A final figure will be announced on June 10.

The European Central Bank, which aims for an inflation rate of no more than 2.0 percent in the eurozone, will likely view the latest figures as a reason to continue slowly increasing interest rates, economists believe.

"The ECB isn't going to rush to hike its rate in June. But German figures aren't low enough to stop it from raising the rate in July," according to Carsten Brzeski, an economist for the Dutch banking and insurance firm ING.

© 2011 AFP

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