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3mo ago

German Inflation Steadies at 2.1% as Energy Costs Ease

Modest consumer-price gains in May reflect falling energy bills offsetting sharper rises in food and service sectors.

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Die Verbraucherpreise in Deutschland sind wie in den Vormonaten auch im Mai nur mäßig gestiegen. Die Inflationsrate lag im vergangenen Monat bei 2,1 Prozent im Vorjahresvergleich, wie das Statistische Bundesamt mitteilte.

Overview

  • Consumer prices rose 0.1% between April and May, keeping the annual inflation rate steady at 2.1%.
  • Energy expenses were 4.6% lower than a year earlier, with cheaper fuel and heating helping to damp overall price growth.
  • Food prices climbed 2.8% year-on-year, driven by steep increases in butter (17.6%) and chocolate (20.2%), even as items like sugar became markedly cheaper.
  • Service-sector inflation remained high at 3.4%, fueled by rising labor costs and significant jumps in transportation services (11.4%) and insurance premiums (9.4%).
  • Core inflation excluding energy and food held at 2.8%, and forecasters from the Bundesbank and Ifo-Institut expect headline rates to remain just above 2% through late 2025 before edging toward target levels.