Germany’s industrial producer prices showed a slight year-on-year (YoY) increase of 0.8% in December 2024, though they fell by 0.1% compared to November 2024. This data, released by the Federal Statistical Office (Destatis), highlights the ongoing fluctuations in Germany’s industrial sector as it adjusts to post-pandemic economic conditions.
While the annual growth in December was modest, the average industrial producer prices in 2024 were 1.8% lower compared to 2023. In 2023, producer prices had increased by just 0.2%, indicating a stark contrast in pricing dynamics year over year.
Key Insights:
Capital Goods: Prices for capital goods rose by 1.8% in December 2024, with machinery prices climbing by 2.0% compared to the same month last year.
Excluding Energy: When energy prices are excluded, producer prices rose by 1.2% YoY in December 2024, maintaining the same level as November 2024.
Basic Chemicals: The cost of basic chemicals fell by 0.7% compared to December 2023, reflecting the varied trends within different sectors of industry.
While Germany’s industrial production costs remain under pressure from global inflation and supply chain disruptions, the sector has shown some resilience, particularly in machinery and capital goods. The data underscores the challenges and adjustments businesses face as they navigate rising operational costs, especially amid fluctuating energy prices and global market uncertainties.
This rise in producer prices, though marginal, suggests that the German industrial sector is experiencing moderate inflationary pressures, but also highlights the general slowdown compared to the more significant price hikes seen in previous years.