German consumer price index picks up in July

Germany’s consumer price index in July rose 0.4 percent year-on-year, consistent with consensus expectation, stated Germany’s official statistics office Destatis. Inflation measured by the CPI rose slightly for the third straight month. On sequential basis, consumer price index was up 0.3 percent last month.

The rise in inflation was mainly driven by food and services prices. Food prices rose 1.1 percent year-on-year, driven mainly by vegetable and fruit prices that increased 8.6 percent and 6.2 percent respectively. On the contrary, fall in energy prices had a downward effect on the overall inflation.

Energy prices dropped 7 percent on annual basis. The drop in energy prices accelerated slightly year-on-year when compared with the past few months.

Consumers have gained particularly from mineral oil products’ prices that dropped in July 2016 by 12.8 percent year-on-year. Other energy products’ prices also fell on a year-on-year basis. According to Destatis, the inflation rate excluding energy prices would have been 1.3 percent in July.