By Nina Adam

FRANKFURT--German producer prices in December saw their strongest annual increase in about four years, a sign that inflationary pressures are building in Europe's largest economy.

Germany's statistics office said Friday producer prices rose 0.4% from November and were up 1.0% from December 2015. That marks the strongest year-over-year increase since January 2013. The outcome was in line with economists' forecasts.

Energy prices developed unevenly in December. While prices for light heating oil jumped about 40% from December 2015 and prices for diesel fuel and electricity were up about 13% and 4.5% respectively. Natural gas prices were sharply lower than in December 2015.

Excluding energy prices, which can be volatile, German producer prices rose 0.3% on the month and increased 1.2% on the year.

Consumer goods prices, which comprise food prices, rose markedly in December. Prices in this category increased 0.5% from November and were up 2.1% from December a year earlier.

Rising producer prices in Germany are likely to underpin expectations that consumer prices will continue to rise over coming months.

Write to Nina Adam at

(END) Dow Jones Newswires

January 20, 2017 02:48 ET (07:48 GMT)

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