German Import Price Inflation Accelerates on Oil

German import prices, an early indicator of inflation pressures in the economy, increased the most in almost a year in October, led by a surge in oil prices.

The price of imported goods rose 2.3 percent from a year earlier, the most since November 2006, after 1.3 percent in September, the Federal Statistics Office in Wiesbaden said today. Economists expected an increase of 1.9 percent, the median of 13 forecasts in a Bloomberg News survey shows.
A 59 percent gain in oil prices this year to almost $100 a barrel is threatening to drive up inflation in Europe’s largest economy even as a rising euro makes imports more affordable. The European Central Bank on Nov. 8 signaled concern that companies will pass on higher costs, triggering an inflation spiral.

“Without the euro helping to offset energy costs, import prices would show even stronger gains,” said Karsten Junius, an economist at Dekabank in Frankfurt. “Further developments hinge on oil prices. There are clear warning signs for the ECB.”

Bloomberg