Germany’s Inflation rate at +2.2% in 2024

The Federal Statistical Office reports that the inflation rate in 2024 was therefore markedly lower than in the three preceding years. The rate of inflation was +5.9% in 2023, as high as +6.9% in 2022 and +3.1% in 2021, on an annual average basis. Before, it seldom exceeded the two-percent mark, on average, in a calendar year, the last time being 2011 when inflation also stood at +2.2%.

Particularly sharp rise in service prices

The prices of services (total) in 2024 showed above-average growth (+3.8%) compared with 2023, after services had cost markedly more (+4.4%) in 2023 already. For example, there was a particularly sharp rise in insurance prices (+13.2%) on an annual average basis in 2024. Compared with 2023, significant price rises were also observed in 2024 for services of social facilities (+7.8%), catering services in restaurants, cafés and the like (+6.8%) and the maintenance and repair of vehicles (+6.1%), for instance.

Net rents exclusive of heating expenses, which are a major factor contributing to the development of prices, were up 2.1% in 2024 on an annual average basis and therefore slightly lower than overall inflation. The development of telecommunications prices (0.0%) was also below the annual average of 2024. The combined tickets for rail, bus and the like (-7.4%), in particular, cost less in 2024 than in 2023 due to the previous year’s price development with the introduction of the Germany ticket in May 2023.

Also, the prices of goods increased 1.0% in 2024 from 2023, with food prices rose 1.4%. In the food (only in German) category, consumers had to pay markedly more in 2024 for edible fats and oils (+10.3%) and sugar, jam, honey and other confectionery (+6.4%), for instance, compared with 2023. By contrast, dairy products (-2.1%) and vegetables (-1.5%), for example, were less expensive.

Energy product prices down 3.2% in 2024 compared with 2023

The prices of energy products fell by 3.2% in 2024 year on year, following an increase of 5.3% in 2023 and a steep hike of 29.7% in 2022. On an annual average basis, the prices of household energy (total) dropped by 3.1% in 2024. For example, electricity (-6.4%), heating oil (-3.9%) and natural gas (-3.5%) cost less than a year earlier. By contrast, among household energy products, the price of district heating increased substantially by an annual average of 27.1% in 2024 compared with 2023. In addition, the price of motor fuels (-3.2%) fell on an annual average basis in 2024 compared with 2023. Excluding energy prices, the year-on-year rate of price increase in 2024 would have been +2.9%.