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German inflation pushes above ECB target in April

·1-min read
FILE PHOTO: The spread of the coronavirus disease (COVID-19) in Germany

BERLIN (Reuters) - Germany's annual consumer price inflation accelerated in April, advancing further above the European Central Bank's target of close to but below 2%, the Federal Statistics Office said on Thursday.

Consumer prices, harmonised to make them comparable with inflation data from other European Union countries, rose by 2.1% in April, up from 2.0% in March. A Reuters forecast had pointed to an April reading of 2.0%.

On the month, inflation rose 0.5%, the data showed.

In Germany, Europe's largest economy, the government raised its growth forecast to 3.5% from a previous estimate of 3% as it expects household spending to support the recovery once COVID-19 restrictions are lifted, the economy minister said on Tuesday.

Last week, the European Central Bank left policy unchanged, keeping copious stimulus flowing even as it predicted a firm rebound in the euro zone economy in the coming months as pandemic restrictions are lifted.

The ECB is keeping borrowing costs pinned near record lows via massive bond purchases to see the 19-country currency bloc through a scarring recession that has kept schools, shops, restaurants and hotels closed for most of the last year.

But growth is expected to rebound quickly from mid-year as COVID-19 infections are brought under control, the pace of vaccination picks up and restrictions are removed, raising questions about just how much ECB help is still needed.

(Writing by Paul Carrel; Editing by Riham Alkousaa and Thomas Escritt)