Inflation in Germany, Europe's largest economy, hit its highest level for more than three years in December, beating analyst expectations, official data showed on Tuesday.

A basket of consumer items increased in price by 1.7 percent in December 2016 from  the same month the previous year, figures from the federal statistics office Destatis showed.

It was the fastest pace of inflation since July 2013, and beat the 1.5 percent predicted by analysts surveyed by Factset.