Inflation Rises Again in Germany for the First Time This Year

Fri 29th Aug, 2025

In August, Germany experienced its first increase in inflation this year, according to data released by the Federal Statistical Office. Prices for goods and services rose by an average of 2.2 percent compared to the previous month. In contrast, the inflation rate had remained steady at 2.0 percent in both June and July.

Energy prices, however, continued to decline, decreasing by 2.4 percent year-over-year, although this was an improvement from the 3.4 percent drop recorded in July. On the other hand, the cost of services increased by an average of 3.1 percent, consistent with the previous month's figures. Cyrus de la Rubia, the chief economist at Hamburg Commercial Bank, noted that rising wages, which remain historically high, play a significant role in this inflationary trend.

In a positive development for consumers, many workers are finding that they have slightly more disposable income. The food sector saw a price increase of 2.5 percent, compared to a 2.2 percent rise in July. In North Rhine-Westphalia, the most populous state, consumers have faced significant hikes in prices for certain items, including a staggering 24.4 percent increase for coffee and a 14.2 percent increase for apple juice compared to the previous year. Overall, fruits have seen an average price rise of 9.6 percent, with strawberries, raspberries, and gooseberries increasing by as much as 19.4 percent. Vegetables have also become more expensive, with cucumber prices surging by 30.2 percent and tomato prices climbing by 26.9 percent.

The core inflation rate, which excludes food and energy prices, remained unchanged at 2.7 percent. The European Central Bank (ECB) has set an inflation target of around 2 percent for the eurozone, and the German inflation rate, calculated according to European standards, currently stands slightly above this target at 2.1 percent.


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