Germany's inflation hits 2.9% in August
The annual inflation rate in Germany rose to 2.9% in August from 2.8% in July, driven by a surge in energy prices which jumped to 10.5% from 8.3% the previous month, as a result of the ripple effects of the Middle East war on raw materials and energy costs. Despite this, the inflation increase was lower than analysts' expectations, which had forecasted 3.1%. Core inflation remained steady at 2.4%, with the government estimating that inflation will reach 2.7% in 2026 before rising to 2.8% in 2027. There is also a likelihood that the European Central Bank will raise interest rates in September to combat the rising energy prices linked to the war between the United States, Israel, and Iran.
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