1.9%. That was Germany's inflation rate in February 2026, according to Destatis. Sounds tame. Almost reassuring. After the shock years of 2022 and 2023 with rates above 6%, anything under 2% feels like normal again.
Except: that 1.9% is an average. A weighted basket of hundreds of products and services, compiled by the Federal Statistical Office based on roughly 300,000 individual price recordings per month. And averages have an unpleasant habit of accurately representing almost nobody. A single person in Munich and a family in Saxony live in completely different price realities, even though the official rate is the same for both.
What's Inside the 1.9%
The consumer price index (VPI) breaks down into two major blocks: goods and services. In February 2026, they moved in completely different directions.
Services: +3.2%. Tradespeople, hairdressers, insurance, rent, repairs. Anything that involves labor is getting pricier. The reason is obvious: wages are rising (minimum wage at EUR 13.90, collective agreements above 3%), and service providers pass that on.
Goods: +0.8%. Clothing, furniture, electronics, household items. Price pressure has calmed down here, partly because global supply chains have normalized and demand for durable goods is weakening.
Energy: -1.9%. The only category with a deflationary effect. Wholesale prices for gas and electricity have dropped significantly since the 2022 crisis peak. End consumers see less of that drop than they'd hope (grid fees, levies, base charges), but still: energy is pulling the overall rate down.
Food: +1.1%. After the extreme increases of recent years (butter up 85% since 2020, olive oil up 54%), things have calmed down. But "calmed down" doesn't mean "cheaper." The new prices are the new normal prices. Butter at EUR 2.39 stays at EUR 2.39. It just isn't rising as fast as it did in 2023.
This is a pattern that frustrates many consumers: the inflation rate drops, but prices don't. A food inflation rate of +1.1% doesn't mean groceries are getting cheaper. It means they're getting one percent more expensive than last year, which was already significantly more expensive than the year before.
Core Inflation: The Number Economists Care About More
Core inflation, the CPI excluding food and energy, sits at 2.5% in February 2026. That's well above the headline rate. And it's exactly this number the ECB watches most closely, because it shows how deep price pressure runs across the broader economy.
2.5% core inflation means: the price increases for services, rent, and skilled labor are sticky. If most of your spending goes to rent, insurance, and food (which is the case for most households), you're feeling a higher inflation than the official number suggests.
