Data published by the Federal Statistical Office (Destatis) showed that in December, producer prices fell by 1.2%, accelerating compared to November (-0.5%), and exceeding economists' forecasts (-0.5%). In annual terms, producer prices fell by 8.6% after declining by 7.9% in November. Consensus estimates suggested an 8% drop. It was the sixth straight month of decline. On an annual average basis, industrial producer prices were 2.4% lower in 2023 than in 2022. A higher decline was last recorded in 2009 (-4.2% on 2008).
Destatis said that in December, energy prices decreased by 23.5% per annum and by 3.7% on a monthly basis. Lower electricity prices had the biggest influence on the year-on-year rate of change for energy. Across all customer groups, electricity prices declined by 35.6% per annum and by 5.6% m/m. Natural gas (distribution) prices decreased by 22.4% per annum and by 3.5% on a monthly basis. Meanwhile, prices for intermediate goods fell by 3.7% per annum, but remained unchanged compared to November. The year-on-year decline in prices was mainly due to the price development for metals and basic chemicals. The prices of non-durable consumer goods increased by 3.2% per annum and remained unchanged compared to November. Food prices increased by 2.8% per annum. Prices for durable consumer goods increased by 3.0% compared to December 2022 and fell by 0.1% m/m. Capital goods prices rose by 3.9% per annum and remained unchanged compared to November.
The data also showed that in December, the producer price index excluding energy remained unchanged on a monthly basis and increased by 0.3% per annum.