Inflation rate in Germany rises to 1.7 pct in January

The inflation rate in Germany in January rose by 0.2 percentage point to 1.7 percent compared to the previous month, the Federal Statistical Office (Destatis) announced on Thursday.

Prices of goods in Germany were up 2.0 percent year-on-year. Destatis noted that prices for energy products in particular had increased by 3.4 percent after falling slightly in December.

Prices for fuels even increased by 5.2 percent while those for electricity were up 3.9 percent compared to last year.

Destatis noted that the overall consumer prices were driven by the increases in energy product prices. Excluding energy prices, the inflation rate in Germany was only 1.5 percent in January.

Food prices also went up on average by 2.3 percent. Meat and fruit were particularly expensive, according to Destatis.

On the other hand, the prices for package holidays went down by 28.7 percent, while those for long-distance train journeys had been reduced by 10 percent compared to the previous month, Destatis noted.

As part of the climate package to reduce greenhouse gas emission and promote a switch from cars to environmentally friendly trains, the German government reduced value-added tax on long-distance train tickets at the beginning of January.