German August inflation confirmed at 2.9% as energy prices soar

(Sharecast News) - Germany's inflation rate held at 2.9% in August, federal statistics office Destatis confirmed on Thursday, matching the flash estimate as higher energy costs continued to offset softer food and core price pressures.

Headline CPI rose 0.2% month‑on‑month, with energy inflation jumping 10.5% - the biggest jump in three years - on elevated wholesale gas and power prices, while food prices were broadly flat after months of easing.

Core inflation, excluding volatile food and energy prices, edged up to 2.4%, underscoring persistent services‑sector pressures even as broader consumer demand remained subdued across Europe's largest economy.

Destatis said services inflation reached 2.8%, driven by transport and housing‑related costs, though discretionary spending categories continued to show signs of weakness.

"In August, higher energy prices were again the primary drivers of overall inflation," said Destatis president Ruth Brand. "The rise in energy prices, caused primarily by the war in Iran, was particularly noticeable in the case of motor fuel prices," she added.

Prices at the pump were up 27.5% year on year in August and compared with a 26% increase in July, Destatis said.

Reporting by Frank Prenesti for Sharecast.com