German inflation slowed to 2.9% y/y in January

Compared to the previous month, the indicator increased by 0.2%

In January 2024, inflation in Germany slowed to 2.9% compared to January 2023. In December, the rate increased by 3.7% y/y. Thus, inflation in the country reached its lowest level since June 2021 (+2.4%). This is evidenced by data from the German Federal Statistical Office Destatis.

Compared to December 2023, the inflation rate in Germany increased by 0.2%.

Energy prices in January decreased by 2.8% compared to January 2023, restraining inflation. In December, this figure increased by 4.1% y/y.

Food prices increased by 3.8% y/y over the month, compared to 4.5% y/y in December.

In January, core inflation in Germany amounted to +3.4%, slowing down from 3.5% in December.

As GMK Center reported earlier, inflation in Germany slowed to +5.9% in 2023 compared to +6.9% in 2022. In 2023, energy prices in Germany increased by 5.3% y/y after a significant increase of 29.7% in 2022. Core inflation in 2023 was +5.1% after +3.8% in 2022.

German economy decreased by 0.3% in 2023 compared to 2022. The figure fell for the first time since 2020, driven by high inflation, rising interest rates and a downturn in economic activity both at home and abroad. Adjusted for inflation and calendar factors, Germany’s economy shrank by 0.1% y/y in 2023.