Consumer Prices: Strong increase in August
Consumer Prices

Strong increase in August

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Compared to August 2020, prices for meat and meat products increased by an average of 3.5%.
Compared to August 2020, prices for meat and meat products increased by an average of 3.5%.

GERMANY, Wiesbaden. Meat, milk, vegetables and eggs are also responsible for the high inflation rate in Germany. In addition, the temporary reduction in value-added tax is having an impact.

Consumers in Germany had to dig significantly deeper into their pockets when buying food last month than in August 2020. As the Federal Statistical Office (Destatis) reported today, prices for food goods in August 2021 exceeded the previous year's level by an average of 4.6%. In July, the inflation rate in question had been 4.3%, and in June, 1.2%. The Wiesbaden-based statisticians put the general inflation rate for the previous month at 3.9%, after 3.8% in July and 2.3% in June. The last time there was a higher inflation rate was in December 1993, when it was 4.3%.

Destatis reiterated that the increase in the inflation rate since July had a number of reasons, including base effects from low prices in 2020. "In particular, the temporary reduction in VAT rates and the drop in the price of petroleum products in 2020 will continue to have an increasing effect on overall inflation year-on-year until the end of 2021," it said. Added to this are the introduction of CO2 pricing since January 2021 and crisis-related effects, such as the significant price increases at the upstream economic stages, which are, however, so far only partially and weakened reflected in the consumer price index," explained the head of the "Consumer Prices" unit at the Federal Statistical Office, Christoph-Martin Mai.

In the food segment, according to Destatis, consumers had to pay more for vegetables as well as dairy products and eggs in particular compared to August 2020; these were offered in the stores on average 9 and 5%  more expensive, respectively. Prices for meat and meat products increased by an average of 3.5%, and those for fruit by an average of 2.5%. According to Destatis, the year-on-year price increases for energy products and food had a significant impact on the inflation rate. Excluding energy products, the inflation rate in August 2021 would have been "only" 3%; excluding both goods sectors, it would have been 2.8%. Heating oil increased in price by 57.3% within the year, fuels by 26.7%. Prices for natural gas rose by 4.9% and those for electricity by 1.7%.

Source: fleischwirtschaft.de; AgE
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