Overview

• The inflation rate in Germany fell to 2.2% in March 2025, down from 2.3% in February, marking continued stabilization since its December 2024 peak of 2.9%.
• Food prices rose significantly, with a 2.9% year-over-year increase driven by sharp hikes in staples like butter, which climbed 26.6% in Hesse and 21.1% in Bavaria.
• Energy prices dropped by 2.8% compared to March 2024, with notable decreases in fuel and heating oil costs, providing relief to consumers.
• Service sector inflation slowed to 3.4% in March, down from 3.8% in February, though it remains a key contributor to overall price pressures.
• Regional variations persist, with inflation rates rising to 2.5% in Saxony and 2.4% in Hesse, while North Rhine-Westphalia reported the lowest rate at 1.9%.