Germany’s inflation rate has edged back up to 2.4 percent in September 2025, according to data released by the Federal Statistical Office (Destatis). This follows a provisional estimate released at the end of the previous month and represents a second consecutive rise after a period of decreasing inflation earlier in the year. President of Destatis, Ruth Brand, acknowledged the reversal, highlighting that prices for services remain stubbornly high while the previously significant dampening effect of falling energy prices has weakened considerably.
The data reveals a complex picture; while energy product prices were down 0.7 percent year-on-year, this marks a fifth consecutive month of decelerating price decline, significantly lower than the -2.4 percent registered in August 2025. Fuel prices saw an unexpected increase of 1.1 percent, the first rise since May 2024. Consumers did benefit from lower prices for heating oil, wood pellets, electricity and district heating. However, increases in natural gas and light heating oil prices, though moderate, contribute to overall inflationary pressures.
Food prices, while still elevated at 2.1 percent year-on-year, are now below the overall rate of inflation for the first time since January 2025. However, the persistent rise in prices for confectionery, fruit products, dairy goods, eggs, meat and processed meats demonstrates that food price inflation remains a key concern for households.
A particularly worrying trend noted by Destatis is the sustained pressure underlying “core inflation” – the rate excluding energy and food. The rate stood at 2.8 percent in September 2025, slightly higher than the previous months of June, July and August. This suggests that inflationary forces are deeply embedded in broader economic activity and not solely reliant on external factors like energy markets.
Service sector inflation persists at a concerning level, rising 3.4 percent year-on-year. Significant increases were observed in areas like combined passenger transport, social facility services, stationary health services, insurance premiums, vehicle maintenance and water and housing services. Rental costs remained a significant contributor to overall inflation, rising 2.0 percent.
The rise in the consumer price index signals ongoing economic challenges. The data prompts questions about the effectiveness of current monetary policies, particularly considering the stubborn inflation embedded across services and manufactured goods. The modest decline in the price of entertainment and information technology devices offers minimal comfort amidst a broader climate of rising prices, raising concerns about the sustainability of consumer spending and the potential for a future economic slowdown. The return of inflation necessitates a critical reassessment of policy strategies to mitigate further pressure on German households and businesses.