BERLIN – German inflation accelerated to a record high in September, data released on Thursday highlighted rising price pressures as Europe’s largest economy recovered from the epidemic and its companies were plagued by supply shortages.
Consumer prices, which are consistent with inflation data from other EU countries, rose .1.1 percent year-on-year to 4.4 percent in August, according to the Federal Statistics Office.
It was the highest rate recorded since January 1997, when the EU-Surela series began.
Business-friendly Free Democrats (FDP) leader and Social Democrats (SPD) and a possible three-way alliance with the Greens called for Christian Lindner, the next finance minister, to return to Twitter. More conservative fiscal policy.
He said the high inflation rate was another reminder that policymakers should “focus on reducing the burden on the middle class and returning to public finance”.
Under the outgoing Finance Minister Olaf Schulz to replace Chancellor Angela Merkel after the SPD’s election victory, Germany abandoned a balanced budget monetary policy and took on a record amount of debt to deal with the epidemic.
Breaking down inflation data shows that fuel and food prices have risen the most.
The rise in inflation this year has sparked controversy over the need for an exceptionally relaxed monetary policy, ranging from tax hikes to supply and commodity prices.
The Bundesbank said this week that German inflation is already likely to accelerate from a high and will remain above 2 percent by mid-2022, exceeding the European Central Bank’s target for the 19-nation eurozone.
Friji Kohler-Geib, chief economist at state-owned KFW, said in a note that while the single effect would disappear in the new year, other factors, such as a shortage of natural gas and coal supplies, could keep up the pressure on prices.
“Energy prices are currently rising for other reasons: for example, Russia and Norway have shortages and supply problems with coal and natural gas. In addition, last winter’s cold stocks have been depleted, and wind power is suffering from a weather-related vacuum, ”Kohler-Ghaib said.
He added: “As a result, energy prices will remain high by the end of the year with intense pressure on gas and electricity components.
This News Originally From – The Epoch Times