German Inflation Edged Down More Than Expected in June

By Ed Frankl

Inflation in Germany fell more than expected in June, a signal that inflationary pressures are easing more sustainably, likely reassuring the European Central Bank after it cut interest rates for the first time in five years.

Consumer prices were 2.2% higher than in June last year, down from the 2.4% in May, German statistics office Destatis said Monday. This was lower than the consensus of 2.3% from economists polled by The Wall Street Journal.

June's lower inflation reading was driven by energy prices that declined at a faster rate than in May, though food inflation was higher in June than in the prior month.

Core inflation, which strips out more volatile energy and food prices, was 2.9% in June, down slightly from 3.0% in May.

The ECB cut its key interest rate for the first time since 2019 early in June, to 3.75% from 4.0%.

Write to Ed Frankl at edward.frankl@wsj.com

(END) Dow Jones Newswires

July 01, 2024 08:29 ET (12:29 GMT)

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