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Inflation in Germany has fallen to its lowest level since Russia’s war of aggression against Ukraine began in February 2022. Consumer prices in September were 4.5 percent higher than in the same month last year, after 6.1 percent in August, the German Federal Statistical Office announced on Thursday, based on preliminary figures.
The last inflation rate, the number 4 after the decimal point, was 4.3 percent in February last year. Following the start of the war in Ukraine, energy prices rose rapidly, increasing inflation in general.
Rising prices have been a burden on consumers in Switzerland’s northern neighbor for months. People can get less for their money. This situation slows down private consumption, which is an important basis of the German economy.
The German federal government is trying to provide relief, including price curbs retroactive to January 1 and aimed at making natural gas, electricity and district heating more affordable. According to preliminary data, consumer prices increased by 0.3 percent in September compared to the same month last year.
According to preliminary figures, food prices increased significantly, especially in September, and increased by 7.5 percent in a year. However, the increase in energy prices has slowed down significantly. Home energy and fuels are 1 percent more expensive than a year ago.
Economists had expected inflation to weaken in September as the effect of the 9-euro ticket and fuel discount disappeared compared to the previous year’s comparison. The 9-euro ticket and fuel discount, limited to three months in the summer of 2022, temporarily slowed the rise in consumer prices. The Germany ticket, which has been in force since May 2023, is much more expensive at 49 euros.
Inflation is currently at 8.8 percent in autumn 2022, well below the highest level since German reunification nearly 30 years ago.
According to economists, the inflation rate is likely to continue weakening until the end of the year. “On the price front, the situation is gradually easing,” said Oliver Holtemöller of the Leibniz Institute for Economic Research in Halle. Energy raw material prices are currently significantly lower than at the last peak, hindering the development of consumer prices.
Leading German economic research institutes expect an average annual inflation rate of 2.6 percent in 2024, following an expectation of 6.1 percent this year. The institutes assume that the interest rate hike phase in the fight against high inflation is slowly coming to an end.
The European Central Bank (ECB) has increased interest rates in the euro area ten times in a row.
(SDA)
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
