By Maria Martinez

German consumer prices declined further in December on the year, confirming preliminary data, German statistics agency Destatis said Tuesday.

On a year-on-year basis, consumer prices fell 0.3% measured by national standards, in line with the drop expected by economists polled by The Wall Street Journal.

Consumer prices declined 0.7% year-on-year by EU-harmonized standards, as expected by economists polled by The Wall Street Journal.

The inflation rate was partly influenced by the value-added-tax reduction effective at the beginning of July, the statistics office said. The temporary VAT cut will be reversed in January.

As an annual average, the inflation rate is expected to stand at 0.5% in 2020, Destatis said.

Consumer prices rose 0.5% on month by national standards and 0.6% by EU-harmonized standards. This met projections by economists polled by The Wall Street Journal.

Write to Maria Martinez at maria.martinez@wsj.com

(END) Dow Jones Newswires

January 19, 2021 02:20 ET (07:20 GMT)