Germany consumer prices grew at the fastest pace in more than 27 years in July largely due to the low base of comparison, final data published by Destatis revealed on Wednesday.
Consumer prices increased 3.8 percent on a yearly basis in July, faster than the 2.3 percent rise seen in June. This was the biggest growth since December 1993, when inflation was 4.3 percent.
“The sudden base effect occurring in July 2021 had been expected as the tax reduction had been passed on to consumers a year ago, involving price decreases for many products,” said Christoph-Martin Mai, head of the consumer prices section at the Federal Statistical Office.
“The upward effect on prices is augmented by special developments for some products, in particular energy products,” Mai added.
Food prices advanced 4.3 percent in July and services cost grew 2.2 percent. Cost of transport increased 9.8 percent and clothing and footwear prices moved up 5 percent.
Excluding energy, consumer prices increased 2.9 percent in July from the last year and inflation, excluding food and energy was 2.7 percent.
On a monthly basis, consumer prices were up 0.9 percent, in line with the flash estimate.
EU harmonized inflation accelerated to 3.1 percent in July from 2.1 percent in June. The rate matched the preliminary estimate published on July 29.
Harmonized inflation has stayed above 2 percent since April 2021.
Month-on-month, the harmonized index of consumer prices were up 0.5 percent, as initially estimated, versus 0.4 percent in June.