German inflation has likely peaked, says Ifo expert

BERLIN, July 28 (Reuters) – The proportion of German companies that plan to increase prices declined for the third month in row in July, an indication that inflation has peaked, an Ifo institute survey found.

“Prices are still likely to continue to rise, but the pace will slow,” said Ifo head of forecasts Tim Wollmershaeuser on Thursday, adding there was usually a few months’ lag between company price expectations being reflected in consumer prices.

“This means that inflation has probably reached its peak and will gradually decline in the course of the second half of the year,” he added.

Ifo’s indicator for the proportion of companies planning to increase prices in the next three months slipped to 47.4 in July, from 52.9 last month and 57.8 in May.

The German inflation rate cooled slightly in June to 8.2% on the year. Analysts polled by Reuters expect the July figure to come in at 8.1%. 

(Writing by Miranda MurrayEditing by Mark Potter)