German Inflation Surges to 2.8% Amid Energy Price Hikes

German inflation accelerated to 2.8% year-on-year in July 2024, according to preliminary data from the federal statistics office.

The increase was largely driven by higher energy prices caused by the Iran conflict, which propelled energy inflation to 8.3% in July from 3.4% in the previous month.

Core inflation, excluding volatile food and energy prices, fell slightly to 2.4% from 2.5% in June.

The German data come ahead of the euro zone inflation release on Friday, with economists polled by Reuters predicting a 2.9% inflation rate for the bloc, slightly above June's 2.8%.