June 15, 2023

Consumer price index in Germany, May 2023
+6.1% on the same month a year earlier (provisional result confirmed)
-0.1% on the previous month (provisional result confirmed)

Harmonised index of consumer prices, May 2023
+6.3% on the same month a year earlier (provisional result confirmed)
-0.2% on the previous month (provisional result confirmed)

The inflation rate in Germany, measured as the year-on-year change in the consumer price index (CPI), was +6.1% in May 2023. In both March and April 2023, the inflation rate stood at over 7% (March: +7.4%; April: +7.2 %). “The rate of inflation has continued to slow but remains at a high level nevertheless”, says Ruth Brand, President of the Federal Statistical Office. She adds: “The year-on-year increase in energy prices was much smaller in May, and food prices continued to be the biggest driver of inflation.” The Federal Statistical Office (Destatis) also reports that consumer prices in May 2023 fell by 0.1% on April 2023.

Prices of energy products up 2.6% year on year

Energy product prices were 2.6% higher in May 2023 than a year earlier. The increase in energy product prices therefore slowed notably (April 2023: +6.8%) and is meanwhile markedly lower than overall inflation. The fact that the increase in energy prices has been below average since March 2023 is mainly due to a base effect originating from last year’s large price increases as a result of the Russian attack on Ukraine. The development of energy prices is subject to many factors, for example the price decreases currently observed at upstream stages in the economic process. Measures of the Federal Government’s third relief package such as the brakes on electricity, natural gas and district heating prices also contributed to the slowing of the energy price increase.

Particularly high price rises were recorded for natural gas (+25.6%) and for firewood, wood pellets and other solid fuels (+23.8%) from May 2022 to May 2023. Above-average price increases were observed also for electricity (+12.7%) and district heating (+11.4%). The prices of these household energy products rose at a slightly slower pace, however. By contrast, the prices of mineral oil products declined substantially by 15.5%, with both heating oil (-30.5%) and motor fuels (-14.2%) costing less than a year earlier.

Food prices remain biggest driver of inflation: +14.9% from May 2022

Food prices were up by 14.9% in May 2023 compared with the same month a year earlier. Although the increase in food prices slowed somewhat (April 2023: +17.2%), food prices remained by far the biggest driver of inflation among all product groups. There were year-on-year price increases mainly for dairy products (+28.2%), bread and cereals (+19.3%) as well as fish, fish products and seafood (+19.0%). Consumers still had to pay notably more also for other food products such as sugar, jam, honey and other confectionery (+17.9%) and vegetables (+17.3%). Edible fats and oils, by contrast, cost 7.1% less than a year earlier, which was mainly due to falling butter prices (-23.3%).

Inflation rate excluding energy and food at +5.4%

Excluding energy prices, the inflation rate stood at +6.5% in May 2023. When energy and food prices are excluded, the inflation rate was lower (+5.4%), which demonstrates the enormous impact of food prices on overall inflation. At the same time, this rate clearly shows that inflation is still high also in other product groups. The consumer price index excluding energy and food crossed the five-percent threshold already in December 2022 (+5.2%) and had gone up even further since the beginning of the year (April and March 2023: + 5.8% each). The figure increased slightly less in May than in the previous months.

Prices of goods up 7.7% on May 2022

The prices of goods (total) were up 7.7% in May 2023 on the same month of the previous year. The price increase was particularly pronounced for non-durable consumer goods (+9.1%), which was mostly due to the rise in food prices. The prices of durable consumer goods were 5.3% higher compared with May 2022.

4.5% increase in service prices year on year, Germany ticket has downward effect

The prices of services (total) increased by 4.5% in May 2023 compared with the same month a year earlier. In April 2023, the rate of price increase was +4.7%. Several factors influenced the below-average increase in the price of services, which slowed slightly. Net rents exclusive of heating expenses continue to play an important role, having a dampening effect on prices (+1.9%). In addition, the introduction of the Germany ticket had a slight downward effect on the development of prices in May 2023. Just like the 9-euro ticket in June, July and August 2022, the Germany ticket resulted in price changes in public passenger transport: at +0.6% in May 2023, price increases for short-distance rail tickets slowed considerably year on year (April 2023: +6.1%). Combined tickets for rail, bus and the like were down 22.9% on May 2022. By contrast, some prices for services continued to increase considerably, including prices for the maintenance and repair of dwellings (+15.8%) and prices for package holidays (+13.6%).
Month-on-month comparison: food and energy prices down, Germany ticket with additional dampening effect

Compared with April 2023, the consumer price index fell slightly by 0.1% in May 2023. Food prices dropped slightly (-0.3%) compared with the previous month, with a particular decline registered for the price of fresh vegetables (-6.1%). The decrease in the prices of energy (total) was somewhat more pronounced (-1.4%). Decreases were observed particularly in the prices of heating oil (-9.3%) and motor fuel (-2.6%) compared with the previous month. Compared with April 2023, prices in public passenger transport also eased as a result of the introduction of the Germany ticket: prices of transport association tickets were markedly down (-26.6%) and the prices of short-distance rail tickets fell by 5.2%. By contrast, price increases were recorded particularly for package holidays (+2.6%) and overnight stays (+1.9%).

Source: DESTATIS
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