German inflation rate probably only temporarily below 2%
At 1.9%, the inflation rate in Germany fell below the ECB's target of 2% in August for the first time in more than three years.
Dr Ralph Solveen
Commerzbank Economic Research
08/29/2024
However, this fall is largely due to significantly lower energy prices. The core inflation rate excluding food and energy prices was also lower than in the previous month, but at 2.8% it was still well above 2%. This suggests that the inflation rate will stay below this level only for a short time. The national figures available to date support our expectation that the euro area inflation rate has also fallen significantly and, at 2.1%, was close to the ECB target.
Inflation rate below 2% for the first time in a long time, ...
Is the inflation surge really over? At first glance, the August data for German consumer prices at least suggest that it is. According to provisional figures from the Federal Statistical Office, inflation fell significantly from 2.3% in July to 1.9% in August and was thus below 2% for the first time since March 2001.
For full text see attached PDF-Version.
