July Report: Inflation at 0.1% and Unemployment at 6.4% in Germany
US GDP Expanded by 2.3% in 2Q15
Economic indicators stalled despite ECB stimulus
The Germany-tracking iShares MSCI Germany (EWG) was down 0.57%, as Germany’s inflation and unemployment rate held steady despite the ECB’s (European Central Bank) monetary easing measures. European equities have demonstrated increased volatility in July, especially with the Greek crisis that has weakened investor confidence. On July 30, the Vanguard FTSE Europe ETF (VGK) fell 0.04%, while the SPDR DJ Euro STOXX 50 ETF (FEZ) fell 0.42%. While SAP (SAP) and Anheuser-Busch InBev (BUD) fell 0.62% and 4.15%, respectively, on July 30, ArcelorMittal (MT) fell 2.31%.
Germany’s inflation rate is stable at 0.1% in July
The EU (European Union) harmonized inflation rate in Germany held steady at 0.1% in July on a YoY (year-over-year) basis. The inflation rate in Germany, which did show a rise for three months pursuant to the launch of the ECB’s monetary stimulus package in March, appears now to be held back. As you can see in the above chart, Germany emerged from deflation in February. The inflation rate in the economy has been rising since then. In June, the inflation fell from 0.7% in May to 0.1% in June. It is now stable at that level in July.
On a month-over-month basis, Germany recorded a 0.30% rise in the EU harmonized CPI (consumer price index).
Unemployment rate steady at 6.4% in Germany
The unemployment rate in Germany has largely depicted a declining trend over the past year. It is down from the 6.7% during the period from May through September 2014 to 6.4% currently. However, the unemployment rate has held steady at this rate for four months now. With economic indicators still weak in Germany, one may not expect the rate to decrease further any time soon.
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