German producer prices rose at the quickest annual rate in three years in August on record high mineral oil and steel costs, Federal Statistics Office data showed today.
Prices advanced by 0.3 per cent month-on-month and by 2.2 per cent year-on-year, the biggest annual gain since an increase of 2.7 per cent in August 2001, the Office said. In July, prices rose 0.6 per cent month-on-month and by 1.9 per cent year-on-year.
Mr Joerg Lueschow, an economist at WestLB in Duesseldorf, said the increase in factory gate prices in August was slightly less than he expected and predicted a weakening of demand for oil in coming weeks.
He said West LB was forecasting consumer prices, expected to be released at the end of next week, to show a 0.2 per cent month-on-month decline in September as package holiday prices fall, helping reduce the annual rate of inflation to 1.9 per cent from 2.0 per cent.
The Statistics Office said on Friday that mineral oil costs advanced by 3.6 per cent in August from July and by 12.2 per cent from the same month a year earlier, while rolled steel prices gained 1.5 per cent on the month and 29.1 per cent on the year.
Excluding volatile oil, producer prices were up 1.6 per cent year-on-year after a 1.5 per cent gain in July.
Among products that posted price declines in August, electronically integrated circuits dropped 12.4 per cent, data processing devices fell 9.6 per cent and glues and gelatine declined 7.1 per cent.