German wholesale prices ease in May on energy tax cut, annual rate still elevated
German wholesale prices fell 0.4% month-on-month in May, driven by a reduction in the energy tax on petroleum products, but the annual rate remained elevated at 30.5% for petroleum.
German wholesale prices edged lower in May, with the monthly decline largely reflecting a reduction in the energy tax rate on petroleum products. The Federal Statistical Office reported a 0.4% month-on-month drop, driven by a 7.3% decrease in petroleum product prices. However, on an annual basis, wholesale prices remain significantly elevated, with petroleum products costing 30.5% more than in May 2025.
For central bank policy traders, the data offers a nuanced picture. The monthly decline may provide some relief to the European Central Bank (ECB) as it monitors inflation dynamics, but the persistent annual increase in wholesale prices—particularly in energy and metals—suggests underlying price pressures remain. Non-ferrous ores, metals, and semi-finished metal products also fell 0.4% on the month but were 36.1% higher year-on-year. These trends could influence the ECB's assessment of the inflation outlook and its policy path. For real-time rates on German Bunds and other eurozone instruments, traders can refer to NowPrice's live quotes.
Looking ahead, market participants will focus on upcoming eurozone inflation data and ECB communications for further clues on the timing and pace of potential rate adjustments. The divergence between monthly and annual wholesale price trends underscores the challenge for policymakers in distinguishing transitory effects from persistent inflation. The next German producer price index release and eurozone CPI figures will be key data points to watch.