Germany – stubborn core inflation

Core inflation rate stable at 2.7%

Somewhat surprisingly, the German inflation rate rose from 2.0% to 2.2% in August (consensus: 2.1%), moving slightly further away from the ECB's inflation target of 2%. This is primarily due to the fact that energy prices did not fall as sharply as in July compared with the previous year. The core inflation rate, which excludes the often highly volatile prices of energy and food, remained at 2.7% as in the previous month, thus not continuing the slight downward trend observed in the previous months. It therefore remains stubbornly above the ECB's target.

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