The recent data showcases a noteworthy decline in German inflation to 2.9% in January from 3.7% in December, marking the lowest level since June 2021. Core CPI mirrors this trend, slowing to 3.4% in January from 3.5% in December, reaching its lowest point since June 2022.

Delving deeper, energy prices experience deflation, dropping by -2.8% YoY. Furthermore, Food CPI decelerates to 3.8% from 4.5% in December.

This sets the stage for the anticipated pivot from the ECB.