Germany inflation rate at 2% for July; energy prices surge 

The annual rate of inflation in Germany is at 2 per cent for July, according to first estimates from the Federal Office of Statistics.

The office’s figures, released Monday, showed the inflation rate continuing to holding at around the 2-per-cent mark for the third month in a row.

The rate was down by 0.1 percentage points compared to June, and 0.2 percentage points compared to May.

A sharp rise in energy costs (6.6 per cent) fuelled rising prices.

The price of groceries rose at an above-average rate of 2.6 per cent in July, though this rise was slower than in June, when prices rose by more than 3 per cent compared to the previous year.

The European Central Bank has set a eurozone target for annual inflation of under 2 per cent, with the aim of ensuring stable economic development, being sufficiently above zero without being too high.

If consumer prices remain consistently low, or fall across a wide range of products, then companies and individuals are unwilling to invest, putting the brakes on the economy.

Source: dpa