The Federal Statistical Office (Destatis) has confirmed the inflation rate for July 2026 at 2.8 percent. This figure was previously projected towards the end of the month. For context, the inflation rate stood at 2.3 percent in June 2026 and 2.6 percent in May 2026, following a slightly higher reading of 2.9 percent in April 2026.
Destatis President Ruth Brand stated that energy prices continued to increase disproportionately, remaining a key driver of cost increases. She highlighted that the inflation rate rose significantly compared to the previous month, largely due to noticeable increases in fuel prices. This increase was driven by the simultaneous rise in oil prices, a trend linked to the ongoing Iran conflict, and the conclusion of the state fuel discount on June 30th.
Overall, the prices for energy products were 8.3 percent higher in July 2026 compared to July 2025. This represented a substantial increase compared to previous years (June 2026: +3.4 percent; May 2026: +6.6 percent; April 2026: +10.1 percent). Beyond the crude oil market movements, the temporary reduction in energy tax on fuels, which expired on June 30, 2026, is also cited as a reason for the renewed price hike. Within the year, fuel prices increased by 23.0 percent in July 2026, a steeper rise than in the two preceding months (June 2026: +11.3 percent; May 2026: +18.0 percent).
Prices for light heating oil, a component of household energy costs, also rose significantly year-on-year due to crude oil market developments, reaching +34.7 percent in July 2026 (June 2026: +29.4 percent; May 2026: +47.9 percent). Despite this increase, total household energy costs were 1.4 percent cheaper than the previous year, as light heating oil constitutes only a small portion of total household energy consumption expenses. Household energy prices had already fallen by 1.6 percent against the previous year in June. Furthermore, electricity prices declined by 5.3 percent, natural gas (including operating costs) by 2.9 percent, and district heating by 1.2 percent compared to July of the previous year. Some of these price decreases are attributed to measures implemented by the federal government since the beginning of the year.
Food prices rose by 0.4 percent in July 2026 year-on-year, remaining stable at +0.4 percent in both May and June 2026. Items experiencing price increases included meat and meat products (+1.9 percent, with beef and veal rising by +7.2 percent), along with sugar, marmalade, honey, and other sweets (+4.0 percent). Conversely, food fats and oils fell by 15.3 percent (including butter at -30.1 percent), while dairy products decreased by 5.9 percent compared to July 2025.
For July 2026, the inflation rate excluding energy was +2.2 percent, and the rate excluding heating oil and fuel was +1.9 percent. The core inflation rate (excluding food and energy) was +2.4 percent, falling below the overall inflation rate.
The prices for goods were 2.5 percent above the level of the previous year. Consumer goods increased by 3.7 percent, primarily driven by expensive energy products (+8.3 percent), while durable goods rose by 0.3 percent. Among goods, information processing devices saw a substantial year-on-year increase of +9.6 percent, and tobacco products rose by +6.0 percent. However, prices declined for certain items, such as household appliances (-2.0 percent) and consumer electronics (-4.0 percent).
Overall, service prices increased by 2.9 percent in July 2026 compared to the previous year, down from 3.1 percent in June 2026. While the increase in services has slightly moderated, it remains close to the overall inflation rate. Specific sectors saw sharp increases, including social services (+6.5 percent), package holidays (+5.6 percent), and vehicle maintenance and repair (+4.7 percent). Also higher than a year ago were water supply services and other domestic services (+3.2 percent), and hospitality services (+2.9 percent). Notably, net cold rent remained a significant factor, rising by +1.8 percent year-on-year. Prices for telecommunications services were nearly unchanged at +0.1 percent compared to the previous year.
Comparing July to June 2026, the overall consumer price index rose by 0.8 percent. During the summer travel season, international package holidays (+12.6 percent) and international flights (+7.1 percent) saw price jumps, despite a reduction in air traffic tax. Travelers also faced higher costs for combustion-engine journeys. Fuel prices surged (+11.2 percent), including diesel fuel (+12.6 percent) and super fuel (+11.0 percent), following the conclusion of the state “fuel discount” on June 30, 2026.
In month-on-month terms, total energy prices rose by 5.0 percent, with light heating oil contributing +6.4 percent alongside fuel. Food prices remained nearly stable overall (+0.1 percent), though prices for fresh fruit fell by 2.4 percent. Consumers also benefited from price decreases in individual daily necessities such as butter and coffee (both down 2.3 percent). Clothing articles, notably, became cheaper month-on-month (seasonally) by 5.4 percent.
