Germany’s annual inflation rate slowed to 2.8% in October 2026 from 3.3% in September, exceeding expectations for a larger-than-expected decline as energy price growth eased. The harmonized index of consumer prices, used for euro-area comparisons, also rose 2.8% year on year, below the 3.1% forecast and September’s 3.3%. Energy inflation eased to 12.2% from 14.9%, while core inflation, excluding food and energy, fell to 2.1% from 2.4%. Services inflation declined to 2.5% from 2.7%, goods inflation fell to 3% from 3.8%, and food inflation held at 0.4%. Consumer prices dropped 0.2% month on month, while the harmonized measure fell 0.1%. The slowdown followed the revival of a temporary fuel-tax reduction and came after regional declines in Bavaria, North Rhine-Westphalia, Lower Saxony and Baden-Wuerttemberg; Saxony was unchanged. Germany’s inflation rate remained below readings in France, Italy and Spain and above the European Central Bank’s 2% target on the harmonized measure. The European Central Bank left interest rates unchanged but indicated another hike in December, while euro-area inflation was expected to rise to 3.9% in October from 3.8% in September.