Inflation in Germany, Europe's biggest economy, slowed noticeably in June with consumer prices rising by just 0.3 percent year-on-year, preliminary data showed on Monday.

In May, the index had risen by 0.7 percent on a 12-month basis, the federal statistics office Destatis said in a statement.

The reason for the slowdown was a sharp decline in energy prices, the data showed.

Using the Harmonised Index of Consumer Prices (HICP) -- the yardstick used by the European Central Bank -- inflation in Germany rose by just 0.1 percent year-on-year in June, down from 0.7 percent in May and a long way below the ECB's annual inflation target of just below two percent.

The June data are still only preliminary, since they are based on consumer price statistics from only six of Germany's 16 regional states.

Final data from all 16 states will be published on July 14, Destatis said