Inflation slows in four German states in May, pointing to national decrease

By Maria Martinez

BERLIN, ‌May 29 (Reuters) - Inflation ​fell ​in four key German states in May, preliminary data showed on Friday, suggesting Germany's ‌national inflation rate could ease this month despite higher ⁠energy prices due to the Iran war.

In Bavaria, the inflation ‌rate fell to 2.6% in ‌May from 2.9% in April. In North Rhine-Westphalia, it decreased to 2.4% from 2.7%, in Baden-Wuerttemberg to ​2.4% from 2.6% and in Lower Saxony it fell to 2.7% from 3.0%.

The war in Iran ⁠had pushed up energy and raw material prices in previous months and the ​German government now expects inflation to accelerate to 2.7% this year and 2.8% in 2027.

Economists ​polled by Reuters are forecasting ‌a harmonised national inflation rate in Germany - the euro zone's largest economy - of 2.8% ⁠in May, down from 2.9% in the previous month.

National figures will be released later on Friday.

The German data comes ahead ⁠of the euro zone inflation release on Tuesday. Inflation in the ​bloc is expected to come in at 3.3% in May, up from 3.0% in the previous month, according to economists polled ‌by Reuters.

The European Central Bank kept interest rates on hold at its meeting in ‌April, but a further increase in inflation is making ⁠it very likely that ‌the bank will follow ​up its earlier warnings with actual policy action next month.

(Reporting by Maria MartinezEditing by Madeline ‌Chambers)

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