Data published by the Federal Statistical Office (Destatis) showed that in March, producer prices fell by 0.7% after declining by 0.1% in February (revised from -0.2%). This was the sharpest drop since December 2023. Economists had expected a decline of 0.1%. In annual terms, producer prices fell by 0.2% after increasing by 0.5% in February (revised from +0.7%). This was the first decrease in 5 months. Consensus estimates suggested growth of 0.4%.
Destatis said that lower energy prices were the main reason for the year-on-year decline in producer prices. By contrast, non-durable and durable consumer goods, capital goods and intermediate goods were more expensive than in March 2024. When energy prices are excluded, producer prices rose by 1.4% per annum and by 0.2% compared with February. Energy prices fell by 3.6% compared to March 2024 and by 2.8% in monthly terms. Across all customer groups, electricity prices declined by 4.3% per year and by 5.2% compared to February. Natural gas (distribution) cost 3.6% less than in the same month a year earlier (-1.5% from February), and district heating cost 1.9% less than in March 2024 (unchanged from February).
Intermediate goods prices increased by 0.5% per year and by 0.3% on a monthly basis. The prices of non-durable consumer goods increased by 2.6% per annum and by 0.3% m/m. Food was 2.9% more expensive than in March 2024 (+0.3% m/m). Durable consumer goods cost 1.3% more than a year earlier and rose by 0.2% on a monthly basis. Capital goods prices rose by 1.9% per year and by 0.1% compared with February.