BREAKING: EUR ticks lower after German CPI data

German flash CPI inflation for November was released at 1:00 pm GMT. Market expected a slowdown in headline CPI from 3.8% YoY in October to 3.5% YoY now. However, an unexpected drop in flash CPI reading from Spain released this morning suggested that deceleration in German inflation may be larger than expected. Also, German state-level CPI readings released throughout the day came in much below last month's readings. 

Actual report confirmed what was hinted by Spanish data and German state-level readings. German CPI inflation decelerated from 3.8% to 3.2% YoY in November with CPI dropping 0.4% month-over-month. However, reaction on the market was small as a big slowdown was expected. EURUSD ticked lower in a knee-jerk move, but scale of this drop did not exceed 0.1%.

Germany, CPI inflation for November

• Annual: 3.2% YoY vs 3.5% YoY expected (3.8% YoY previously)
• Monthly: -0.4% MoM vs -0.1% MoM expected (0.0% MoM previously)

German state-level CPI readings for November

• North Rhine-Westphalia: 3.0% YoY vs 3.1% YoY previously
• Hesse: 2.9% YoY vs 3.6% YoY previously
• Bavaria: 2.8% YoY vs 3.7% YoY previously
• Brandenburg: 4.1% YoY vs 4.6% YoY previously
• Saxony: 3.9% YoY vs 4.5% YoY previously
• Baden Wuerttemberg: 3.4% YoY vs 4.4% YoY previously

Source: xStation5