BERLIN: Inflation in Germany, Europe's biggest economy, dipped into negative territory in January for the first time in five years, largely due to lower energy prices, data showed Thursday.
German inflation was -0.3 percent this month compared to January 2014, the federal statistics office, Destatis, said releasing in its provisional figure, which sank slightly more than analysts polled by Factset had forecast.
In December it had slowed to 0.2 percent, its lowest level in more than five years.
Using the Harmonised Index of Consumer Prices (HICP) -- the yardstick used by the European Central Bank -- inflation in Germany was even lower at -0.5 percent year-on-year, way under the ECB's annual inflation target of just below 2.0 percent.
Falling energy and food prices have weighed on German inflation in recent months.
The last time it dropped into negative territory was September 2009.
Analysts noted it was good news for consumers but bad news for the European Central Bank, ahead of the latest eurozone inflation data due Friday.
"Actual negative inflation can lead to lower inflation expectations which then perpetuate low inflation and make the eurozone vulnerable for deflationary shocks," said analyst Christian Schulz at Berenberg Bank said.
Last week the ECB launched a massive trillion-euro bond purchase programme to ward off deflation and end stagnation in the eurozone economy.
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