Germany is expected to experience the lowest inflation level since June 2021 of 2.4 per cent.

The inflation rate in January 2024 is anticipated to be +2.9 per cent annualised relative to January 2023. The inflation rate in December 2023 was +3.7 per cent annualised.

Based on data provided so far, the Federal Statistical Office of Germany (Destatis) predicts that consumer prices will increase by 0.2 per cent for the month of January 2024. Core inflation in January is expected to be +3.4 per cent (December 2023: +3.5 per cent).

Food prices continued to rise at a slower rate (+3.8 per cent) in January 2024 relative to January 2023, but remained higher than the overall inflation rate. However, energy prices were down 2.8 per cent in January 2024 relative to January 2023.

This despite the discontinuation of the brake on energy prices and the introduction of a higher carbon price in German.