Germany Inflation December 2021


Germany: Harmonized inflation slides in December

January 20, 2022

Harmonized consumer prices rose 0.4527% from the previous month in December, accelerating matchingfrom November's 0.27% rise. Strong price increases for food and non-alcoholic beverages, furnishing, household equipment and routine maintenance, and recreation and culture offset notable price drops for clothing and footwear, and transport.

Harmonized inflation came in at 5.97% in December, which was down from November’s 6.0%. Meanwhile, the trend pointed up, with annual average harmonized inflation coming in at 3.2% in December (November: 2.7%).

Analysts at the EIU added:

“We expect an easing in January 2022 as changes in the value-added tax (VAT) rate, oil prices, carbon emissions costs and the minimum wage fall out of the annual comparison period, although base effects stemming from still-depressed prices in early 2021 will keep the headline rate elevated. Domestic demand will become a more important driver of consumer price growth as 2022 progresses, alongside continued energy price pressures and supply-chain disruptions. We forecast an annual average inflation rate of 3.5% in 2022, moderating to an average of 1.8% in 202326. This will dampen opposition to the ECB's accommodative monetary policy.”

FocusEconomics panelist expect harmonized inflation to average 2.2% in 2022 and 1.7% in 2023.


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Germany Inflation Chart

Germany Inflation December 2021

Note: Annual and monthly variation of consumer price index in %.
Source: Federal Statistics Office (Destatis) and FocusEconomics calculations.

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