Slight Decline in German Inflation Amid Calls for Economic Growth and Reform
October 2025 inflation in Germany declined slightly, but economic experts call for urgent reforms to overcome stagnation and foster sustainable growth.
- • German inflation fell slightly to 2.3% in October from 2.4% in September, driven by lower energy prices.
- • Core inflation remains stable at 2.8%, indicating persistent price pressures.
- • The ECB keeps interest rates steady at 2.0%, targeting 2% inflation medium-term.
- • Economic stagnation and bureaucratic delays are hindering Germany’s growth potential.
- • Calls for reform emphasize valuing entrepreneurship and creating favorable conditions for investment.
Key details
In October 2025, Germany saw a modest decrease in inflation rates, with consumer prices rising by 2.3%, down slightly from 2.4% in September, based on preliminary data from the Statistisches Bundesamt. This change was mainly driven by a 0.9% drop in energy prices, although food prices increased by 1.3% compared to the previous year. Services costs also rose by 3.5%, and core inflation—excluding volatile energy and food prices—remained steady at 2.8%, indicating persistent underlying inflationary pressure. The European Central Bank (ECB) has maintained key interest rates at 2.0%, aiming for a medium-term inflation target of 2%. Economists such as Ralph Solveen of Commerzbank caution that inflation could rise if expansive fiscal policies spur economic growth in the coming year.
Alongside inflation trends, Germany faces broader economic challenges marked by stagnation and delayed reforms. In a commentary by Wolf Matthias Mang, President of the Association of Hessian Entrepreneurs, there is a strong call to prioritize genuine economic growth over increasing debt. Mang highlights the country's sluggish decision-making and excessive regulation as factors undermining private investment and innovation. He stresses the necessity of growth to sustain social security, education, and technological advancement, while warning against the ideological skepticism surrounding entrepreneurship. The commentary underlines that Germany possesses abundant talent and resources but requires an improved environment that values entrepreneurial risk-taking and fosters investment to secure its future prosperity.
These insights reveal a dual economic narrative for Germany: a slight easing of inflationary pressures but an urgent demand for structural reforms and growth measures to overcome stagnation and ensure long-term economic vitality.