Germany confirms its record inflation in October, which rose to 10.4%
Inflation gives no respite in Germany. The consumer price index (CPI) in the German country broke its own record again after rise to 10.4% in the month of Octoberfour tenths more than the year-on-year increase in prices registered in September, when it already reached 10%, as confirmed by Destatis, the German statistics office. The harmonized inflation rate reached an even higher value of 11.6%.
The year-on-year inflation figure of 10.4% represents a new all-time high for the country since there are records in the reunified Germany, after the 10% price increase in September would have already been the highest price increase since 1991. “The rate of inflation has reached an all-time high since German reunification“, stressed Georg Thiel, president of the Federal Statistical Office, for whom “the enormous rises in prices of energy products continue to be the main reason for high inflation”.
However, the Destatis representative has alerted that “more and more price increases are also observed for many other goods and services“, highlighting the increase in food, something “particularly notable for households”. In this sense, in addition to the increase in the prices of energy products due to the war and the crisis, the bottlenecks and the significant price increases in the previous stages of the economic process are also having an impact on the inflation rate, causing other goods and services, including food, to become more expensive.
Two temporary relief measures ended in September implemented by the German Government: the 9 euro public transport ticket and the fuel discount, something that already had an accelerating effect on prices last month, when the inflation rate jumped to 10%. On the other hand, Destatis highlighted that The first measures of the third government aid package have already been implementedincluding the reduction of the tax on the supply of natural gas and district heating, which has dropped to 7% from 19% in October and had a downward effect on the increase in the prices of energy products.
Gas costs twice as much and also affects food
In October, the prices of energy products increased by 43% year-on-year, moderating just nine tenths with respect to the rise observed in September, despite the relief measures introduced. Specifically, the cost of natural gas more than doubled (+109.8%) and district heating prices increased by +35.6%, as the reduction of the tax on the volume of sales of natural gas and district heating from 19% to 7% “It was more than offset by increases in natural gas and heating prices and was only able to cushion these increases.”
On your side, food became more expensive in October by 20.3% compared to the same month last year, meaning that this price increase was almost twice the rate of headline inflation and accelerated from the 18.7% rise in September. Thus, excluding energy prices from the calculation, the inflation rate stood at 6.5% in Octoberwhile also leaving out the impact of food prices, the rate of core inflation was limited to 5%, less than half of the general index.
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