German inflation increased to 2.9% year-on-year in August, up from 2.8% in July, according to preliminary data released Monday by the federal statistics office.
The rise was driven by a pickup in energy prices, which climbed 10.5% year-on-year, compared with 8.3% in the previous month. The acceleration in energy costs follows months of upward pressure from geopolitical tensions, including the war in Iran, which have contributed to higher energy and raw material prices.
Core inflation, which excludes volatile food and energy prices, held steady at 2.4% for the second consecutive month. The stability in core prices suggests underlying inflationary pressures remain contained despite the recent energy-driven surge.
Economists polled by Reuters had forecast the EU-harmonized consumer price index to reach 3.1% in August, meaning the actual figure came in below expectations. The preliminary data precedes the release of euro zone inflation figures, scheduled for Tuesday, where economists expect inflation in the bloc to rise to 3.3% from 2.9% in July.
The German government has projected inflation to average 2.7% this year and 2.8% in 2027, reflecting a gradual moderation in price growth following the recent volatility.
