German State-Level Data Signals Faster-Than-Expected Inflation

(Bloomberg) -- Germany is on track for a hotter-than-expected inflation surprise in June if early data from individual states is a guide.

Prices in Saxony gained 0.5% in the month and 1.8% on the year, prompting a jump in the euro. Subsequent releases saw Brandenburg prices rise 0.5% in June, and in Bavaria they increased 0.4%.

Economists forecast a monthly gain of 0.2% for the country as a whole, under national calculations, or 0.1% using a harmonized European Union method.

Other data painted a slightly more subdued picture, with prices rising just 0.1% in Hesse and 0.2% in the most-populous state, North Rhine Westphalia. National data will be released at 2 p.m. Frankfurt time.

The European Central Bank has signaled its ready to add more stimulus for the euro zone because of weak inflation and economic growth regionally, largely because of global trade tensions.

To contact the reporter on this story: Carolynn Look in Frankfurt at clook4@bloomberg.net

To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Craig Stirling

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