BERLIN, Aug 21 Reuters German producer prices decreased more than expected on the year in July, their first fall in over twoandahalf years, as easing energy price pressures added to hopes that inflation in Europe39;s largest economy could abate further.

July producer prices were down 6.0 compared with the same month last year, when producer prices soared as a consequence of the war in Ukraine, the federal statistics office said on Monday.

Analysts had expected a drop of 5.1 in a poll by Reuters.

It was the first yearonyear decline in producer prices since November 2020 and the sharpest decline since October 2009 during the financial crisis.

Energy prices sank 19.3 in July on the year, as electricity prices slumped Across all customer groups, electricity prices fell by 30.0.

With energy prices excluded, producer prices in July were 2.0 higher compared with the same month last year.

On the month, producer prices were down 1.1. Analysts had expected a drop of 0.2.

Germany39;s producer price index, which measures the change in the price of goods sold by manufacturers, is considered a key indicator for inflation, which in July eased to 6.5.

Reporting by Miranda Murray Writing by Rachel More Editing by Kirsti Knolle and Bernadette Baum

Source Reuters