German inflation rate remains at 2.1 percent in May

The inflation rate in Germany remains at 2.1 percent. The Federal Statistical Office has calculated this value for May on the basis of preliminary data for inflation. The inflation rate was also 2.1 percent in April. According to the evaluation, the food has currently risen above average in price, while consumers for energy had to lie down less again than a year ago.

The energy prices went down, they were 4.6 percent below the level of the same month in May. In April, energy was 5.4 percent cheaper than a year earlier. The Federal Government’s announcement that the Federal Government announces is expected to reduce electricity tax.

Consumers benefit from the fact that oil prices are under pressure due to persistent concerns about the global economy in view of the customs dispute with the USA: At the beginning of May, refueling was more cheap than ever in the current year. From the middle of the month, both super gasoline of the E10 variety and diesel were more expensive, as can be seen from the price comparison of the ADAC.

Meanwhile, food was also more expensive in May – again by 2.8 percent as in April. In March it was 3.0 percent.

Your high inflation is persistent in services, which include visits to the restaurant, package tours and car repairs. After 3.9 percent in April, the prices for services in May were 3.4 percent above the level of the previous year. Higher wage costs are passed on to customers faster, especially in the case of services with a high proportion of labor costs.

Commerzbank chief economist Jörg Krämer points out the problem of still high core inflation. He says: “Without the prices for energy and food that is prone to fluctuation, the inflation rate is still significantly above the ECB target of 2 percent. Inflation is stubborn.”

From April to May of the current year, consumer prices rose by 0.1 percent according to the provisional calculations of the Federal Office.

In the euro area, inflation was recently stable at 2.2 percent, as Eurostat data showed for April. This is just above the target of 2.0 percent in the medium term.

The higher the rate of inflation, the lower the purchasing power of the people because they can then afford for one euro less. But also permanently falling prices want to avoid currency authorities as far as possible: In this case, companies and consumers could put investments in the hope of even cheaper prices – that would slow down the economy.

In view of the latest inflation development, economists expect the ECB to decide on a further interest in interest next Thursday (June 5) – it would be the eighth since summer 2024. The deposit interest relevant to savers and banks could be reduced from 2.25 percent to 2.0 percent.

Lower key interest rates usually make loans cheaper. That can push the economy. On the other hand, interest rates in daily and time deposit offers should deteriorate again for savers.

How the prices for goods and services in the export nation Germany will develop in the coming months also depends on the course of the customs dispute with the USA. The Bundesbank assumes that the inflation rate in Germany will fluctuate for the two percent mark in the coming months.

Various forecasts expect that a value of two percent will also come out for the year 2025 on average. In 2024, the inflation rate in Germany was 2.2 percent per year.