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German harmonized annual inflation confirmed at 2.2% in May

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German harmonized annual inflation confirmed at 2.2% in May

German consumer prices rose 2.2% year over year in May, in line with the provisional estimate and going over the European Central Bank's medium-term target of just below 2% for the eurozone.

On a month-over-month basis, harmonized consumer prices climbed 0.6% in May, unchanged from the provisional estimate, data from the country's Federal Statistics Office showed.

The nonharmonized inflation rate increased 2.2% in May from the prior-year period, matching the pace last seen in February 2017. Energy prices, which mainly drove the inflation acceleration in May, went up 5.1% year over year, compared with a 1.3% annual rise in April as prices of heating oil and motor fuels jumped.

Goods inflation rose an annual 2.5% in May, driven by food prices rising at an above-average 3.5% and higher energy prices. Services inflation climbed an annual 1.9%.

Nonharmonized consumer prices rose 0.5% month over month in May.

The confirmed pickup in German inflation comes amid faster-than-expected eurozone inflation in May and as the ECB weighs its latest rate decision.

"Policymakers will have to establish whether this rebound in the rate of inflation is transitory in order to at least allow them to adopt an approach that doesn't box them into a corner when they start to discuss how to execute a possible exit policy," said Michael Hewson, chief market analyst at CMC Markets UK, in a research note.