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Inflation fell in Germany.

 Inflation in Germany and Spain fell in November, prompting a rally in eurozone government bonds as investors bet that price growth in the bloc had peaked and the European Central Bank would shift to smaller interest rate rises.A slowdown in energy and services prices helped inflation in Germany to fall in line with expectations to 11.3 per cent in the year to November, down from a 71-year peak of 11.6 per cent in October, according to data from the country’s federal statistical agency yesterday.Meanwhile, food prices rose in Germany at a faster pace of 21 per cent, and rental prices also accelerated slightly to 1.9 per cent.

Carsten Brzeski, head of macro research at ING Bank, said he was «still a bit cautious about calling this peak inflation», saying there were still significant price pressures for companies to pass on to consumers that could lead to another increase in inflation before February.

But he said eurozone inflation was likely to fall for the first time in 17 months when November price data are published today, making it less likely that the ECB will raise rates by 0.75 percentage points for the third consecutive time it meets in two weeks.

US inflation also fell in October, and global data indicators suggest that this year’s rampant global inflation has peaked.

«It’s looking likely that we’ve seen the peak,» commented Peter Schaffrik, chief European macro strategist at RBC, a bank, adding that even a slow decline in eurozone inflation should be sufficient to halt the sell-off that has swept through the region’s bond markets this year.

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  1. Jessie30 November 2022 at 18:34

    I also think this is not peak inflation in Germany. Just give it 3-4 more months. It's going to get worse before it gets better.

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