German producer prices soar 25% y/y due to energy costs

German producer prices jumped 25% on the year in January, pushed up mainly by higher energy prices, official data showed on Monday.

The January figures continued the trend of very steep increases for the fourth month in a row after October, November and December showed jumps of 18.4%, 19.2% and 24.2%, respectively.

Analysts polled by Reuters had forecast an annual increase of 24.2%.

Producer prices also registered an increase of 2.2% month on month, against a record 5% in December.

Energy prices were up 66.7% compared with January 2021, the Federal Statistics Office said. Stripping out energy prices, producer prices rose 12% on the year.

Producer prices are considered a leading indicator for inflation. They are recorded at the factory gate – before products are processed further or go on sale – and can provide an early indication of consumer price trends.