- Life in Germany will remain expensive at the beginning of 2022. This is due to the high energy prices. In this respect, the slight fall in the inflation rate compared to December 2021 is not noticeable in the wallet.
Inflation in Germany fell below the five percent mark at the beginning of the new year. In January, the inflation rate was 4.9 percent, as the Federal Statistical Office announced in a first estimate on Monday. However, analysts had expected a significantly lower increase in consumer prices compared to the same month last year of 4.4 percent. In December, the inflation rate was still 5.3 percent.
Higher inflation weakens the purchasing power of consumers because they can then buy less for one euro than before. Higher inflation is also gnawing at savings that bear meager interest.
Heating and driving eat the holes in the wallet
Inflation in Europe’s largest economy was again fueled primarily by higher energy prices. On average, consumers had to pay 20.5 percent more for household energy and fuel in January than a year earlier.
On the other hand, there was no effect from the reversal of the temporary reduction in value added tax, which had also fueled consumer prices last year. Nevertheless, the inflation rate remains high, the Wiesbaden authorities said. Crisis-related effects such as delivery bottlenecks and significant increases in energy prices would continue to have an impact. In view of this development, many economists are not expecting a rapid, thorough relaxation on the price front.
Rising consumer prices
According to the first estimate, consumer prices rose by 0.4 percent compared to December. (dpa/hau)