FX.co ★ German Inflation Slows Less than Expected

In October 2025, Germany's annual inflation rate slightly decreased to 2.3%, down from the year-to-date peak of 2.4% recorded in the previous month. However, it exceeded market predictions of 2.2%, based on preliminary figures. The slowdown in consumer prices was noted particularly in goods, which eased to 1.2% from 1.4% in September. This was largely due to significant disinflation in the food sector, which declined to 1.3% from 2.1%, and a quicker reduction in energy prices, which saw a deflation rate of -0.9% compared to -0.7% previously. This decrease was attributed to lower fuel costs and substantial natural gas reserves within the EU. Conversely, inflation in services rose slightly to 3.5% from 3.4%, contributing to a persistently high core inflation rate of 2.8%. On a monthly basis, consumer prices increased by 0.3%.