Germany’s annual inflation rate has plateaued at 2.3% for the second consecutive month, according to preliminary data released Friday by the Federal Statistical Office (Destatis), a development described as “stabilized” by President Ruth Brand. This figure, confirmed for November, follows rates of 2.3% in October and 2.4% in September, signaling a pause in the previously observed deceleration. Prices dipped 0.2% in November compared to October, offering a brief respite for consumers.
While energy prices generally exerted a downward pressure on inflation, with overall energy products 0.1% lower than a year prior and household energy down 1.2%, disparities remain. Consumers benefited from cheaper electricity (-1.5%) and district heating (-0.7%), yet faced increased costs for heating oil (+2.4%) and natural gas (+0.5%). Fuel prices also climbed 1.6% year-on-year, highlighting ongoing vulnerabilities in the transportation sector.
Food prices have increased moderately, up 1.2% compared to November 2024, a rate considered below average. However, the cost of essential goods paints a more concerning picture. Specific categories such as sugar, jam, honey and confectionery – including a startling 19.4% increase in chocolate – alongside meat and meat products, saw substantial price hikes. These rises disproportionately affect lower-income households, prompting renewed scrutiny of supply chain vulnerabilities and potential market manipulation. Conversely, the reduced cost of cooking oils and fresh vegetables provides limited offset.
The “core inflation” rate, excluding food and energy, sits at 2.7%, only marginally lower than the previous month’s 2.8%. This persistent level underlines a worrying trend: price pressures within other key sectors of the economy remain stubbornly above acceptable levels, suggesting that underlying inflationary forces have not been fully extinguished. Critics argue a lack of decisive intervention from policymakers may be contributing to this inflationary inertia and question the effectiveness of current monetary policy strategies in providing a sustainable path towards price stability, particularly given its potential impact on economic growth and social equity. The continued high core inflation rate casts doubt on the government’s ability to meet its stated goals of reducing inflation and maintaining consumer purchasing power.