According to the final report from the Federal Statistical Office (Destatis), in December, consumer price growth accelerated to 3.7% per annum, as expected, from 3.2% per annum in November. On a monthly basis, consumer prices rose by 0.1%, as expected, after declining by 0.4% in November. In 2023, consumer prices rose by 5.9% after increasing by 6.9% in 2022.
"The rate of inflation for 2023 was below 2022's record high. At almost 6%, it is still at a high level, however. Food prices registered particularly sharp increases on an annual average basis in 2023," Destatis said.
The data also showed that in December, energy product prices rose by 4.1% per year after declining by 4.5% per year in November. The development of energy prices in December 2023 was driven by a base effect originating from a one-off measure, known as "December immediate assistance", whereby the Federal Government footed the bill for households' monthly advance payments on gas and heating in December 2022. Meanwhile, fuel prices decreased by 1.1% per annum, while electricity prices remained unchanged. The cost of light heating oil fell by 11% per annum, and prices for natural gas increased by 34% per annum. Food prices rose by 4.6% per year after an increase of 5.5% per year in November. Meanwhile, the CPI excluding energy and food rose by 3.5% per annum. The inflation rate has stayed below the four percent mark since November 2023 as the rate of price increase also slowed gradually in other product groups.
The data also showed that in December, the harmonized index of consumer prices (HICP) - an indicator that allows to compare inflation in Germany with inflation in European countries - rose by 0.2% on a monthly basis and by 3.8% per annum. In November, HICP decreased by 0.7% mom and increased by 2.3% per annum.