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Sunday, October 02 2022
Europe

Berlin: German inflation hits record level of 7.9% in Aug

German inflation hits record level of 7.9% in Aug
Photo Credit : IANS

Berlin: Inflation in Germany soared to a record level of 7.9 per cent in August for the second time this year, the country’s Federal Statistical Office (Destatis) said.

Government measures such as a cheap 9-euro ticket for public transport and a fuel discount had a “slight downward effect on overall inflation”, said Destatis President Georg Thiel, with price increases for transport gradually slowing from 16.3 percent in May to 3.7 percent in August.

However, Europe’s largest economy’s fuel discount expired last week, and pump prices jumped immediately, reports Xinhua news agency.

Standard fuelcost 1.99 euros per litre and was 21.6 cents more expensive than at the end of August.

Meanwhile, diesel prices climbed 8.2 cents to 2.16 euros, according to the German Automobile Club (ADAC).

“The main reason for high inflation is still price rises for energy products and food,” Thiel said.

While prices for food rose by 16.6 per cent year-on-year, energy prices increased more than four times as fast as inflation levels, and were up 35.6 per cent “despite relief measures”.

Without the energy and food price rises, overall consumer price inflation in Germany would be 4.4 percentage points lower, according to Destatis.

Natural gas saw particularly high price increases of 83.8 per cent, while prices for light heating oil more than doubled.

Among food products, prices of edible fats and oils, as well as dairy products and eggs, recorded the sharpest surges of 44.5 per cent and 26.8 per cent, respectively.

To cushion the impact of high inflation on businesses and consumers, the German government recently announced relief measures worth 65 billion euros, bringing total inflation measures to 95 billion euros.

The package also includes a one-time payment to enable households to pay their heating bills during the winter.

Minister of Finance Christian Lindner warned last week that high inflation levels were an “impoverishment program for families in the middle of society”.

The ifo Institute expects inflation in Germany to rise even further to 9.3 percent in 2023, causing real incomes to fall sharply.

Although the measures from the latest relief package should “counteract this decline somewhat, they will fall far short of offsetting it”, the institute warned.

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