Germany's Inflation Moderates in 2024 but Remains Above ECB Target

Consumer prices rose by 2.2% last year, driven by higher service costs, while energy prices eased slightly.

Germany's annual inflation rate for 2024 averaged 2.2%, significantly lower than the peaks of 6.9% in 2022 and 5.9% in 2023.
Service costs, including insurance and restaurant visits, saw a sharp increase, with prices rising by 3.8% on average, outpacing other sectors.
Energy prices fell by 3.2% in 2024, offering some relief, though the decline slowed toward the end of the year.
Food prices increased by 1.4% overall, with notable spikes in items like cooking oils and sweeteners, while some products like dairy and vegetables became cheaper.
Economists predict inflation will stabilize around 2.5% in early 2025, influenced by factors like CO₂ pricing and higher costs for public transportation.