After the cancellation of the fuel discount: inflation in Germany accelerates again
In July consumer prices rose 2.8% year-on-year after the fuel discount ended and energy became more expensive due to the war with Iran.
30 July 2026 — After the end of the temporary fuel discount and because of increased pressure on energy markets caused by the war with Iran, life in Germany in July once again accelerated in price rises, the Federal Statistical Office (Destatis) in Wiesbaden reported: consumer prices were 2.8 percent higher than in the same month last year.
Energy lifts the rate
The reduction of the energy tax on petrol and diesel — almost 17 euro cents per liter — eased price growth in May and June and pushed inflation down to 2.3 percent in June. The discount ended at the end of June, and already in April the oil shock from the war with Iran lifted inflation to 2.9 percent, the highest level since January 2024.
In July energy prices, according to calculations by statisticians in Wiesbaden, were 8.3 percent higher than in the same month last year — significantly more than the 3.4 percent rise recorded in May. At petrol stations, prices above €2 per liter again became the norm, and higher wholesale gas prices most often reach households with a delay.
Food prices rose by 0.4 percent in July compared with the same month last year, the same rate as in the previous two months. Services, including restaurant visits and travel, became 2.9 percent more expensive in July (after 3.1 percent in May and June). Overall, consumer prices rose by 0.8 percent from June to July, according to preliminary data.
Higher inflation rates reduce purchasing power and slow domestic spending, which is a key pillar of the German economy. "Uncertainty remains high, and the effects of the energy shock on inflation have not yet been felt in full," said Christine Lagarde, President of the European Central Bank.
Economists expect the ECB to raise its key interest rates again in September to curb inflation, and the Bundesbank warned that the harmonized rate of inflation in Germany could exceed the 3 percent threshold in the coming months — in July it stood at 2.8 percent.
Photo: press material from the event
