German wholesale prices extend gains in September, inflation risks mount

• Germany's wholesale prices rose 1.9% month-on-month in September.
• The prior month saw an increase of 0.9%.
• On an annual basis, wholesale prices climbed 8.7% in September.
• The prior year's reading was +6.8%.

According to the annual estimate, German wholesale prices stood 8.7% above their level from September 2025. That represents the steepest yearly increase since February 2023, raising concerns about inflation in the country.

A substantial part of the price jump this year can be traced to the Middle East conflict, which lifted wholesale energy prices and those of intermediate goods like metals.

Examining the components, the yearly wholesale price rise is mainly driven by mineral oil product prices, which jumped 48.8% from September 2025. Relative to August 2026, these prices gained 10.5%.

Additionally, wholesale prices for non-ferrous ores, non-ferrous metals, and non-ferrous semi-finished metal products rose 24.9% from September 2025 and 2.1% from August 2026, significantly influencing the year-on-year price trend.

All in all, the latest data paints an uneasy picture for Germany, as companies still contend with higher input costs. Given that energy prices are a key factor, businesses have limited capacity to absorb such increases before shifting some of the cost to consumers.

To be sure, elevated wholesale prices do not automatically translate into consumer inflation right away. However, the more prolonged these cost pressures remain, the more difficult it is for firms to protect households from price increases. That complicates the ECB's task, particularly if higher energy inflation continues to feed into the broader economy and heighten second-round effect risks.