German inflation rate drops below 2 percent mark

Consumer prices in Europe's biggest economy have increased at a slower pace in November than in many months before. Monthly inflation has been held below the level viewed favorably by the European Central Bank. Consumer prices in Germany rose by only 1.9 percent in November, the National Statistics Office (Destatis) reported on Wednesday. The moderate increase followed three months of inflation above 2 percent. Only levels below that threshold are viewed by the European Central Bank as conducive to securing long-term price stability in the 17-member eurozone. The Wiesbaden-based statisticians attributed the lower November inflation rate to pressures in the retail sector which because of the ongoing debt crisis in the euro area could not afford significant price hikes for goods and services. Further easing in sight Nonetheless, prices in some segments of the economy kept rising way above average levels. Destatis particularly mentioned soaring food prices, with fruits being over 10 percent more expensive than in the same month last year. Also weighing heavily on people's purses were fuels at the pumps for which consumers had to spend 3 percent more than last year. Economists said with a German inflation rate of 2 percent throughout 2012, price pressures are expected to ease further next year. That relief would bring a 1.7-percent increase in consumer prices.