German Inflation Unexpectedly Softens In May

(RTTNews) - Germany's inflation unexpectedly softened in May largely reflecting the slowdown in energy price growth, preliminary data from Destatis showed Friday.

Consumer price inflation weakened to 2.6 percent in May. Inflation was forecast to stay steady at 2.9 percent, which was the highest since December 2023.

Likewise, EU harmonized inflation slowed to 2.7 percent from 2.9 percent a month ago. The harmonized inflation was also expected to remain unchanged at 2.9 percent.

However, core inflation that excludes prices of food and energy accelerated to 2.5 percent from 2.3 percent in the previous month.

Services inflation climbed to 3.1 percent from 2.8 percent, while goods prices grew at a slower pace of 2.2 percent compared to 2.9 percent a month ago.

Energy prices logged an annual growth of 6.6 percent compared to the 10.1 percent rise in April. Food price inflation eased to 0.4 percent from 1.2 percent.

On a monthly basis, consumer prices dropped 0.2 percent in May, confounding expectations for an increase of 0.1 percent. The harmonized index of consumer prices also posted a monthly drop of 0.1 percent, contrary to forecast for a 0.2 percent rise.