German inflation creeps up to 2.4% in April on back of higher food prices

German inflation rose slightly in April due to higher food prices and a smaller drop in energy prices than in previous months, preliminary data from the federal statistics office showed on Monday.

 

German consumer prices, harmonised to compare with other European Union countries, rose 2.4% in April, compared with 2.3% year-on-year in March.

 

“The downward trend in the German inflation rate that has been observed for a year and a half may have come to an end for the time being,” Commerzbank economist Ralph Solveen said, adding that the inflation rate is likely to rise again in coming months.

 

Euro zone inflation is expected to remain at 2.4%, unchanged from the previous month, according to economists polled by Reuters.

 

The European Central Bank has clearly signalled it will start lowering borrowing costs in June.

 

Core inflation in Germany, which excludes volatile food and energy prices, eased to 3.0% in April from 3.3% in March.

 

Commerzbank expects the core inflation rate to stabilise around current levels, as companies in the service sector in particular pass on large rises in wage costs to their customers.

 

First Published: Apr 29 2024 | 6:52 PM IST