Consistent Inflation Rate Holds Firm at 2.0%
In the past few years, Germany's core inflation rate has shown a significant decline and stabilization compared to highly volatile food and energy prices. This trend is evident from 2022 through mid-2025.
In 2022, Germany, like much of Europe, experienced high inflation, with a peak around October 2022. The surge was primarily driven by soaring energy and food prices amid disruptions. While the exact German core inflation figure for 2022 is not available, euro area inflation peaked at 10.6% [2].
Moving into 2023 and 2024, core inflation— which excludes volatile food and energy prices— began to moderate as energy prices dropped from peak levels, though food inflation remained somewhat elevated. By September 2024, euro area annual inflation was down to about 1.7%, reflecting easing pressures [2].
In 2025, Germany's inflation data reveal a continued easing in headline and core inflation. By June 2025, the annual inflation rate in Germany fell to 2.0%, the lowest in eight months. This decline was largely due to a decline in energy prices (which fell 3.5% in June) and a slowdown in food price inflation (down to 2.0% from 2.8%) [1].
Core inflation, which excludes food and energy, typically rises slower than headline inflation during periods of volatile commodity prices. The sustained rise in service prices (+3.3% in June 2025) keeps core inflation above the ECB target but much lower than the earlier 2022 spikes [1][2].
| Year | Core Inflation Trend | Food & Energy Price Trend | Notes | |--------------|-------------------------------|-------------------------------------------------------|---------------------------------------------------------| | 2022 | High, driven by volatility | Extreme volatility and sharp increases | Inflation peak of ~10.6% euro area (Oct 2022)[2] | | 2023-2024 | Declining and stabilizing | Energy prices fell sharply; food prices more stable | Inflation fell below 2% by Sept 2024 (euro area)[2] | | 2025 (midyear) | Core inflation moderate (~2%) | Food inflation slowed to 2.0%, energy prices declined | Headline inflation ~2.0% in June 2025 in Germany[1] |
In essence, core inflation in Germany between 2022 and 2025 remained more stable and lower than the headline inflation, which was heavily influenced by volatile food and energy prices. The data from 2025 show that the reduction in energy and food price growth has helped ease headline inflation down to around 2%, close to the ECB's target, while service price rises continue to moderately support core inflation [1][2].
Current figures up to August 2025 suggest stabilization continuing in the near term. The Bundesbank expects the inflation rate in Germany to fluctuate around the two-percent mark in the coming months [1]. The European Central Bank is observing the situation without making a rate cut, and the Council of Experts expects a value around two percent for the 2025 annual average inflation rate in Germany [1].
References: [1] Bundesbank (2025). Monthly Report, July 2025. [2] European Central Bank (2025). Monthly Report, September 2024.
Businesses in Germany have witnessed a decline in core inflation rate over the past few years, despite volatile food and energy prices. This trend, evident from 2022 through mid-2025, indicates a shift in economic figures towards a more stable financial landscape.
