Source: Bloomberg

German inflation is likely to undershoot economists’ forecasts, Bloomberg reports. A simple model shows that most of German headline inflation tracks oil prices, so that the inflation rate will fall through the rest of the year if oil stops rising.

State-level data for March in three of the Germany’s largest contributing states slowed to 1.7%, from 2.2% the previous month, versus economist forecasts of deceleration to 1.9%.

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