German Inflation Confirmed at 1.8% in June


In June, Germany's consumer prices rose 1.8 percent compared with June of 2012. The inflation rate had been 1.5 percent in May and 1.2 percent in April. It was the second consecutive increase in inflation, mainly due to marked price rises for food and energy.

Food prices were up 5.4 percent on the same month a year earlier, a higher increase than for energy prices (+3.0 percent). Food price rises occurred especially for edible oils and fats (+13.0 percent) as well as for vegetables (+10.4 percent) and fruit (+9.2 percent). Regarding energy, electricity prices were considerably higher than a year earlier (+12.0 percent), the main reason being the increase in the surcharge according to the Renewable Energies Act at the beginning of 2013. Not considering the price development for these two product groups, the inflation rate in June 2013 was 1.3 percent.

Total goods prices rose by 2.3 percent in June 2013 compared with June 2012. Price increases were largest for non-durable consumer goods (+3.0 percent), which was mainly due to the price development for food. For some goods, prices were down from a year earlier (for example coffee: −5.3 percent; consumer electronics: −5.0 percent; information processing equipment: −11.7 percent). 

Total service prices rose by 1.6 percent in June 2013 compared with June 2012 (including recreational and sporting services: +4.3 percent; package holidays: +3.3 percent; rail tickets: +3.0 percent). The price decrease for financial services accelerated in June 2013 from June 2012 (−11.8 percent) because handling fees for personal loans were abolished by further banks. 

Compared with May 2013, the consumer price index rose by 0.1 percent in June 2013.Prices were up from the previous month for food (+0.4 percent), in particular edible oils and fats (+1.7 percent; including butter: +2.9 percent) and some fruits and vegetables (for example apples: +10.3 percent; potatoes: +12.6 percent; cucumbers: +16.9 percent).

German Inflation Confirmed at 1.8% in June


Destatis | Nuno Fontes | nuno@tradingeconomics.com
7/10/2013 8:54:57 AM