German inflation showed signs of easing in July, according to recent data from the German Federal Statistics Office Destatis. Despite an increase in energy prices following several months of decline, the consumer price index rose by 6.2% compared to the same period last year, down from 6.4% in June. These figures align with the expectations of economists polled by The Wall Street Journal and with preliminary estimates released by Destatis.
The slight decrease in inflation offers some reassurance to policymakers at the European Central Bank, who have been looking for signs that interest rate increases are starting to temper demand and alleviate price increases.
Although energy prices continued to rise when compared to the previous month, with a 5.7% increase since July 2022, this was primarily due to the elimination of an electricity-bill surcharge from a year ago, as reported by Destatis. Food inflation also showed some signs of easing, but remained high at 11.0% in July, impacting nearly all food groups.
Excluding the influence of energy and food prices, the core inflation rate eased to 5.5%.