Inflationrate in Germany
Explanations and Formulas for calculating inflation


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Consumer price index (CPI) for Germany

The consumer price index (CPI), published by the German Federal Office of Statistics is a key indicator of price development in Germany. The percentage change in the CPI is referred to as an inflation rate or price increase rate. A time period with a rising price index is called inflation, a falling price index deflation. The German Excel file "consumer price index for Germany - long series from 1948" is used as the data basis for the calculations. The data used in this inflation calculator 2025 refers to the current publication of 10.07.2025. Both annual values (sheet 611xx-01) and monthly values (sheet 611xx-03) are published. The Excel sheets contain various price indices for the cost of living for the period 1948 to 1991. Since 1991, a standardized consumer price index and an index of retail prices have also been published. To calculate the consumer price index (CPI) for the former federal territory from 1948 to 1961, the price index for the cost of living is taken from the column "4-Personenhaushalte von Arbeitern und Angestellten mit mittleren Einkommen". For 1962 to 1990 the column "Alle privaten Haushalte" is used and from 1991 the column "Verbraucherpreisindex" for Germany. The index in the published sheets refers in each case as a percentage value to a base year. For the years 1948 to 1990, the price index for the standard of living with base year 1995 (index = 100) and from 1991 the consumer price index with base year 2020 (index = 100) are published. In this inflation calculator 2025 every consumer price index with the base year 1995 is converted to the base year 2020 and displayed in order to calculate the results. The results shown in this inflation calculator2025 only refer to annual values. The last published annual values therefore apply to the year 2024. For the current year 2025, a provisional consumer price index (CPI) from the average of the currently published monthly data is used.

Calculation of the inflation rate from the consumer price index (CPI)

The inflation rate I for the current month or year is defined as the percentage change in the consumer price index (CPI) compared to the previous year:

I = (CPI2 / CPI1 - 1) * 100.

with

  • CPI1: Consumer price index of the previous year
  • CPI2: Consumer price index for the current year

Calculation of the price rise from the consumer price index (CPI)

Inflation causes prices to rise. This means that the same goods and services get a higher monetary value. The calculations are based on the annual averages of the Consumer price index (CPI) for Germany, which have been collected and published by German Federal Office of Statistics since 1948. The amount A2 related to the end of the last year is calculated from the product of the amount A1 at the end of the first year and the ratio of the consumer price index CPI2 at the end of the last year to the consumer price index CPI1 at the end of the first year:

A2 = A1 * CPI2 / CPI1.

For example, an amount of € 1,000 in 2018 would have a value in 2020 of:

A2 = 1,000 * 100.0 / 96.4 = € 1,037.34.

For goods and services worth € 1000 in 2018, € 1037.34 is payable for the same goods and services in 2020. The percentage price increase P is calculated from the consumer price index CPI2 of the last year and the consumer price index CPI1 of the first year as follows:

P = (CPI2 / CPI1 - 1) * 100.

For example, a CPI of 102.0 in 2017 and a CPI of 105.8 in 2020 results in a percentage price increase P of:

P = (100.0 / 96.4 - 1) * 100 = 3.73 %.

Calculation of purchasing power from the consumer price index (CPI)

Inflation reduces the value of money, which means that money has less purchasing power. Purchasing power and price increase are reciprocal to each other. The purchasing power P related to the end of the last year is calculated from the product of the amount A at the end of the first year and the ratio of the consumer price index CPI1 of the first year to the consumer price index CPI2 of the last year:

P = A * CPI1 / CPI2.

For example, a value of € 1000 at the end of 2017 would have a purchasing power P at the end of 2020 of:

P = 1000 * 96.4 / 100.0 = € 964.00.

For € 1,000, only goods and services can be bought in 2020 that had a value of € 964.00 in 2017.

How to calculate average inflation per year

The average inflation rate spent per year applied to the amount in the first year and in each case to the resulting price increases of all subsequent years results in the amount spent in the last year. The average inflation rate per year I is calculated from the of all consumer price indices (CPI) in the period under consideration over n years with i = 1 ... n:

xi = CPIi+1 / CPIi
I = ((x1 * x2 * ... * xn) 1/n) - 1) * 100.

For the years 2017 to 2020, for example, n = 3 results in an average inflation rate I of:

x1 = CPI2018 / CPI2017 = 98,1 / 96,4 = 1,0176
x2 = CPI2019 / CPI2018 = 99,5 / 98,1 = 1,0143
x3 = CPI2020 / CPI2019 = 100,0 / 99,5 = 1,0050
m = x1 * x2 * x3 = 1,0373
I = (m1/n - 1) * 100 = 1,23 %

The average inflation rate of 1.23% applied to the value of € 1,000 in the first year and to each of the following 2 years results in a price increase of € 1,037.35 in the last year:

2018: 1.23 % von € 1,000.00 = € 12.30
2019: 1.23 % von € 1,012.30 = € 12.45
2020: 1.23 % von € 1,024.75 = € 12.60

This results in a price increase of € 1,024.75 + € 12.60 = € 1,037.35. Due to rounding errors, a small deviation occurs compared to the result from the calculation of the price rise from the consumer price index (CPI).

Conversion of the consumer price index (CPI) to the base year 2020

In the published table of the Federal Statistical Office, the index for the years 1948 to 1990 is related to the base year 1995 (index = 100). In this inflation calculator 2025 all indices from this period are normalised to the currently valid reference year 2020 and displayed as the CPI:

CPI = Index1995 * Indexyear / 100.

For the year 1948, for example, the normalized consumer price index (CPI), rounded to one decimal place, is calculated as follows:

CPI = 71.0 * 28.5 / 100 = 20.2.