Infotech Energy prices push inflation to 10% in Germany

Energy prices push inflation to 10% in Germany

Inflation in Germany jumped in September to 10.0% year on year, the highest value since December 1951, due to soaring energy prices in the wake of war in Ukraine, according to sources. provisional figures published this Thursday, September 29.

The price index gained 2.1 points year-on-year from August, according to statistics institute Destatis.

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The evolution of the harmonized price index, which serves as a reference by the European Central Bank, peaks at +10.9% over one year.

200 billion euros released

The monetary institution is determined to bring inflation in the euro zone back within its mandate, to 2%, which has already led it to raise its rates twice since July, by 1.25 points in all, before others not planned in the coming months.

In detail, prices in Germany remain driven by the ongoing explosion in energy prices, caused by the war in Ukraine. They rose by 43.9% over one year in September.

German Chancellor Olaf Scholz announced on Thursday the release of 200 billion euros to precisely cap energy prices that weigh on households and businesses.

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“A cap on gas prices could dampen inflation somewhat in the short term”comments Ulrich Kater, chief economist at Deka.

18.7% inflation on food prices

“However, things will only really improve if liquid gas transport capacities can be quickly expanded over the coming year”he adds.

Food prices also continue to rise, driven by war and droughts. Their increase reached 18.7% over one year, according to Destatis.

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Added to this are the price effects of continued disruptions to supply chains due to the Covid-19 pandemic.

In addition, two measures in force this summer and which expired at the end of August – a discount on fuel and the monthly train ticket at 9 euros – “should have had an impact on the rate of inflation” in September, adds Destatis without quantifying the effect.

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