By Andreas Plecko
WIESBADEN (Dow Jones)–German producer prices for commercial products fell by 8.6 percent in December compared to the previous year. Economists had expected a decline of 8.0 percent. In November the decline was 7.9 percent. As the Federal Statistical Office (Destatis) also announced, producer prices fell by 1.2 percent in December compared to the previous month. On average for 2023, commercial producer prices were 2.4 percent lower than on average for 2022. The last time there was a greater decline compared to the previous year was in 2009.
“However, producer prices remained at a high level in 2023, after rising very sharply in 2021 (plus 10.5 percent) and 2022 (plus 32.9 percent),” explained Destatis. “The main reason for the decline in producer prices compared to the same month last year was the decline in energy prices in December 2023. Intermediate goods were also cheaper than in December 2022, while consumer and capital goods were more expensive.”
Excluding energy, producer prices were 0.3 percent higher than last year and remained unchanged from November. With these statistics, the prices are collected ex-factory, i.e. before the products and raw materials go on sale. Producer prices can therefore provide an early indication of the development of inflation. As a rule, changes in producer prices sooner or later have an impact on retailers and thus on consumers.
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(END) Dow Jones Newswires
January 19, 2024 02:13 ET (07:13 GMT)