Germany Inflation Confirmed at 7-Month High in May


Consumer prices in Germany increased 0.7 percent in May of 2015, up from a 0.5 percent increase in the previous month and matching preliminary estimates. It is the highest inflation figure since November 2014, due to higher cost of food and services and a slower decline in energy prices.

Year-on-year, energy cost (total) decreased by 5.0 percent, following a 5.9 percent drop in the preceding month. Prices were down for: heating oil (-16.7 percent), motor fuels (-6.3 percent), gas (-1.4 percent) and electricity (-0.9 percent). In contrast, prices of solid fuels increased by 2.3 percent.

Cost of food and non-alcoholic beverages increased by 1.4 percent, (including food +1.4 percent), after registering a 1.2 percent rise in April. Prices rose markedly for vegetables (+9.0 percent) and fruits (+5.6 percent). Prices rose also for confectionery (+3.5 percent), fish and fish products (+2.0 percent) and bread and cereals (+1.4 percent). Prices were markedly down for dairy products (–4.8 percent) and for edible fats and oils (–4.2 percent).

Cost of goods as a whole fell by 0.3 percent in May while cost of services increased by 1.2 percent. Among goods, lower prices were recorded for consumer electronics (-5.4 percent) and information processing equipment (–3.2 percent). Consumers had to pay higher prices than a year earlier, for coffee, tea and cocoa (+11.3 percent), newspapers and periodicals (+5.9 percent) and tobacco products (+3.6 percent). Among services, higher cost were seen for net rents exclusive of heating expenses (+1.2 percent), passenger transport (of which taxi ride +12.6 percent), hairdresser services and other services for personal care (+3.3 percent) and catering services in restaurants, cafes and the like (+3.0 percent). In contrast, cost declined for telecommunication services (-1.3 percent).

On a monthly basis, consumer prices rose 0.1 percent in May. Prices increases were seen for energy (+0.3 percent, including  heating oil +3.7 percent) and motor fuels +4.2 percent, including supergrade petrol +4.8 percent, diesel fuel +3.4 percent); housing, water, electricity, gas and other fuels (+0.1 percent); transport (+0.7 percent, including and motor fuels +2.3 percent, including supergrade petrol  and diesel fuel +2.4 percent respectively); recreation and culture (+0.4 percent); miscellaneous goods and services (+0.3 percent); restaurant and hotels (+0.2 percent) and education (+0.1 percent). In contrast, prices were down for: vegetables (-0.8 percent); clothing and footwear (-2.0 percent) and communication (-0.1 percent). 

The harmonized index of consumer  prices (HICP) increased by 0.7 percent in May of 2015 over the same month last year. Compared with the previous month, the index was up  0.1 percent.

Germany Inflation Confirmed at 7-Month High in May


Destatis l Rida Husna l rida@tradingeconomics.com
6/16/2015 9:24:27 AM