German inflation hits 15-year record of 3.3 per cent in June

Jun 27, 2008, 14:19 GMT

Berlin - German consumer inflation continued its upward path in July, hitting a 15-year high of 3.3 per cent on the year, the Federal Statistics Office reported Friday.

Heating oil and transport fuels were the main drivers of the rise, while food prices also rose strongly, the Wiesbaden-based office said. Heating oil prices are around 60 per cent up on a year ago.

Prices, computed on the basis of the six largest states, rose 0.3 per cent on the month.

Annual consumer inflation came in at 3.0 per cent in May, and was as high as 3.1 per cent in March, before retreating to 2.4 per cent in April.

Calculated on the basis of the harmonized European HICP method used across the European Union, German inflation stood at 3.4 per cent in June, up from 3.1 per cent in May.

The European Central Bank, which sets interest rates for the 15-member euro zone, of which Germany is the largest member, aims at an annual inflation rate of under, but close to, 2.0 per cent.

The ECB's refinancing rate is currently 4.0 per cent, where it has stood unchanged for a year.

ECB President Jean-Claude Trichet has signalled a rise to 4.25 per cent when the bank's Governing Council meets on July 3 and has not ruled out the possibility of a further rise this year.