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The Federal Statistical Office announced this on Thursday based on preliminary data. This is the second highest value in reunified Germany after 2022, when inflation reached 6.9 percent.
In December, inflation rose again to 3.7 percent after five months of decline. In November, the lowest level since June 2021 was reached at 3.2 percent.
Economists had expected the trend to reverse in December: a year earlier, the state had taken over the one-off cost of the discount for gas and district heating customers in that month. This price-dampening effect has not been included in the calculation for December 2023. According to preliminary figures, consumer prices rose by 0.1 percent from November to December 2023.
Looking ahead, however, various forecasts assume that inflation in Europe’s largest economy will continue to decline. For example, the Council of Experts for the Assessment of General Economic Development (the ‘Economists’) assumes an average inflation rate of 2.6 percent in 2024. The Ifo Institute expects an average of 2.2 percent this year.
After the Russian attack on Ukraine in February 2022, energy and food prices in particular rose sharply. The inflation rate in Germany rose to 8.8 percent in the autumn of 2022, the highest level since reunification. Inflation has weakened recently.
According to the Federal Statistical Office, many energy products were cheaper in October and November 2023 than a year earlier. Annual food inflation also continued to weaken, but remained well above headline inflation.
Higher inflation rates reduce the purchasing power of consumers, who can afford one euro less. People’s financial resources are shrinking and income growth is being eaten up by inflation.
The highest inflation rate in a full year to date was 7.6 percent in the then Federal Republic of Germany in 1951. However, the calculation method has changed over time. In 2021, consumer prices in Europe’s largest economy rose by an average of 3.1 percent.
(SDA)
Source: Blick
I am Amelia James, a passionate journalist with a deep-rooted interest in current affairs. I have more than five years of experience in the media industry, working both as an author and editor for 24 Instant News. My main focus lies in international news, particularly regional conflicts and political issues around the world.
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