Overview

• Germany's overall inflation rate in March 2025 was 2.2%, slightly lower than the 2.3% recorded in January and February, according to official data.
• Food prices rose by 3.0% year-on-year, driven by significant increases in basic staples such as oils, fats, fruits, and vegetables.
• Energy prices fell by 2.8%, providing some relief to consumers, marking a continued decline from earlier months.
• Economists predict inflation may remain slightly above 2% in the coming months, with potential upward pressure from planned defense and infrastructure spending.
• Proposals to permanently reduce VAT for restaurant meals from 19% to 7% are expected to ease costs if savings are passed on to consumers.