German Inflation Hits Four-Year High

Inflation in Germany, the euro zone's biggest economy, topped its highest level in more than four years in September, driven mainly by soaring oil prices, final data showed on Wednesday. The German consumer price index (CPI) rose by 0.4 percent in September from the figure for August and was 2.5 percent higher than it had been in September 2004, the federal statistics office Destatis said in a statement. The 12-month rate of change is therefore substantially faster than the 1.9 percent recorded in August and is, in fact, the highest level since May 2001. Excluding heating oil and fuel prices, CPI would have remained unchanged month-on-month and risen by just 1.6 percent year-on-year in September, they calculated. The price of light heating oil soared by 40 percent on a 12-month basis and fuel cost 17.4 percent more than it did a year ago, reaching a new record high, Destatis said. A further rise in tobacco taxes also contributed to the acceleration in inflation in Germany last month and food prices also increased.