German inflation turns positive, hits 1.6% y/y in January

BERLIN, Jan 28 (Reuters) - German annual consumer prices turned positive and rose by far more than expected in January, the Federal Statistics Office said on Thursday, attributing a rise in the minimum wage as one possible explanation for the increase.

Consumer prices, harmonised to make them comparable with inflation data from other European Union countries, rose by 1.6% year-on-year after declining by 0.7% in December.

January's preliminary data compared with a Reuters forecast for a rise of 0.5%.

"In addition to the changes in VAT rates, the development of consumer prices may also be influenced by other factors such as the CO2 price and the increase in the statutory minimum wage from January 2021," the Statistics Office said in a statement. (Reporting by Paul Carrel; editing by Thomas Seythal)

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