Latest data released by Destatis - 11 August 2021
- HICP +3.1% vs +3.1% y/y prelim
The preliminary report can be found here. No change to the initial estimates as German annual inflation sees a strong uptick last month relative to a year ago, owing to base effects due to the VAT cut in 2H 2020 for the most part this time around.
The German stats office notes that:
As a consequence of the temporary reduction of VAT rates (from July 2020 to December 2020), consumer prices had fallen sharply in July 2020. The low price level of a year ago now had an upward effect on the price development for many goods and services and, consequently, on the overall inflation rate.
