Germany annual CPI inflation declines to 2.6% in May vs. 2.8% expected

Annual inflation in Germany, as measured by the change in the Consumer Price Index (CPI), softened to 2.6% in May's flash estimate from 2.9% in April. This print came in below the market expectation of 2.8%. On a monthly basis, the CPI declined 0.2% following the 0.6% increase recorded in April.

The Harmonized Index of Consumer Prices, the European Central Bank's (ECB) preferred gauge of inflation, declined 0.1% on a monthly basis and rose 2.7% on a yearly basis. Both of these prints came in below analysts' estimates.

Market reaction

EUR/USD showed no immediate reaction to these figures and was last seen trading virtually unchanged on the day at 1.1645.