German Producer Prices to Fall Most in 22 Years, Threaten Deflation

German [B]Producer Prices[/B] are set to fall at an annual pace of -4.1% in June, the most in over 22 years. The reading implies continued downward pressure on consumer prices in the months ahead, threatening to push CPI into negative territory for the first time since 1986 as lower wholesale costs filter into the final price tag. The onset of deflation in Euro Zone’s largest economy is all but certain to take the currency bloc as a whole along the same trajectory, threatening to commit the region to long-term stagnation as consumers and businesses are encouraged to wait for the best possible bargain and perpetually delay spending and investment.