Germany's consumer price index rose in line with forecasts in January

According to the report from the Federal Statistical Office (Destatis), the inflation rate in Germany, measured as the year-on-year change in the consumer price index (CPI), stood at +1.0% in January 2021, following a 0.3% decrease in December 2020. A positive inflation rate was last seen in June 2020 (+0.9%). Destatis also reports that consumer prices rose by 0.8% compared with December 2020.

The prices of goods (total) were up 0.6% in January 2021 from January 2020. Food prices rose by 2.2%. As a result, the price increase has markedly accelerated (December 2020: +0.5%). Higher prices were recorded in particular for meat and meat products (+3.5%), fruit (+3.2%) and vegetables (+3.1%). In contrast, the prices of energy products were 2.3% lower than in the same month a year earlier. 

Excluding energy prices, the rate of inflation would have been +1.4% in January 2021.

The prices of services (total) were up 1.4% in January 2021 from January 2020. Net rents exclusive of heating expenses, which are important as they account for a large part of household final consumption expenditure, rose by 1.3%. 

Compared with December 2020, the consumer price index rose by 0.8% in January 2021. The prices of energy products climbed by 5.4%. Marked price increases were recorded in particular for motor fuels (+10.7%) and heating oil (+13.9%). In addition to the end of the value added tax reduction, the CO2 charge had an upward effect on prices. Apart from that, the prices of food and non-alcoholic beverages rose by 2.6%; price increases were observed especially for vegetables (+7.8%) and coffee (+3.8%).