Inflation rebounded, and by slightly more than expected, in April. Consumer prices were provisionally flat on the month which was enough to see the annual inflation rate climb 0.4 percentage points to 2.0 percent, reversing much of March's hefty 0.6 percentage point decline. As such the data would seem to confirm that differences in the timing of Easter (March in 2016, April this year) had a significant impact on the March/April profile.
The HICP followed a similar pattern, also showing no change from its final March level and a yearly rate of 2.0 percent, up from 1.5 percent last time.
Not surprisingly given the holiday distortions, the main boost to the change in the annual CPI rate came from services where inflation jumped from 0.7 percent to 1.7 percent, a tick above its February mark. Elsewhere, rent, excluding utilities edged up from 1.6 percent to 1.7 percent while energy was flat at 5.1 percent. By contrast, overall goods inflation dropped 0.3 percentage points to 2.2 percent and food also weighed, slowing from 2.3 percent to 1.8 percent.
The pick-up in German inflation increases the likelihood of a rise in the full Eurozone rate when the flash HICP report is released tomorrow. Easter effects cloud the underlying performance but in Germany at least, core inflation would seem to be creeping slowly higher.