German inflation rose to 2.9% year-on-year in August, up from 2.8% in July, according to preliminary data from the Federal Statistical Office.
The increase fell short of analyst expectations, which had projected a 3.1% reading under the EU-harmonized consumer price index. Energy prices surged 10.5% in the month, compared with 8.3% in July, reflecting upward pressure from geopolitical tensions in the Middle East.
Core inflation, excluding volatile food and energy components, remained unchanged at 2.4% for the second consecutive month. The stability suggests underlying price pressures remain contained despite the energy shock.
The German government has revised its inflation outlook, forecasting an average of 2.7% for 2026 and 2.8% for 2027. The figures come ahead of Tuesday’s eurozone inflation release, where economists expect the bloc’s CPI to climb to 3.3% in August, from 2.9% previously.
The data underscores the divergent inflation dynamics across Europe, with Germany’s moderation contrasting with broader regional pressures.
