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German producer prices picked up faster than expected in January, with broad-based price growth across all categories of industrial products underlying the continued strength of the eurozone’s largest economy.

Data from Destatis showed the index of producer prices for industrial products climbed 2.1 per cent in January from the same month a year earlier, beating analysts’ expectations for a year-on-year rise of 1.9 per cent, according to a Thomson Reuters poll.

The annual pace of growth slowed slightly from December, when producer prices increased by 2.3 per cent from the previous year. While solid, January’s growth rate also lagged behind the impressive 2.7 per cent price growth for 2017 as a whole, suggesting the German economy may be settling in to a steadier rhythm.

Month-on-month however, price rises accelerated — up 0.5 per cent in January from 0.2 per cent the previous month, and 0.1 per cent in December.

Energy prices were up 2.2 per cent overall year-on-year, with a 4.9 per cent rise in the cost of electricity offsetting a slight decline in the cost of natural gas distribution. Intermediate goods saw the biggest price rise of any category, while price increases in the consumer goods categories lagged behind the headline index.

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