Inflation is expected to rise as Germany removes summer discounts on public transport and fuel, but the European Central Bank is concerned about the size of the acceleration.
Inflation in Germany reached double digits for the first time since the introduction of the euro more than 20 years ago, rising more than expected after the end of government bailouts and the worsening energy crisis in Europe. Bloomberg writes about it.
Consumer prices were reported to have jumped 10.9% from last September and were up from 8.8% in August. Most economists polled by Bloomberg expected inflation of 10.2%.
Inflation is expected to rise as Germany removes summer discounts on public transport and fuel, but the European Central Bank is concerned about the size of the acceleration.
“On Thursday, the German government announced a cap on gas prices that could prevent inflation in the future. Chancellor Olaf Scholz’s administration will lend at least 150 billion euros to this initiative,” wrote the Bloomberg.
“We expect energy costs to continue to increase prices next year. Our current forecast is for consumer prices to increase by an average of around 7% in 2023. The government’s aim to limiting gas prices should help lower this forecast, but it depends on the precise action plan,” said economist Martin Ademmer.
In September, energy prices in Germany increased by 43.9% compared to the same period last year, food prices increased by 18.7%, the cost of services – by 3.6%, rental housing – by 1.7 %.
The German federal government is allocating 200 billion to support the national economy and citizens amid the energy crisis. This was said by German Chancellor Olaf Scholz, who commented on the energy supply situation at a briefing, reports Ukrinform.
“Russia’s war against Ukraine continues with all its brutality… We are confident that the Ukrainians are capable of defending their sovereignty and territorial integrity; they can count on us and the world community, which does not just watch how one big powerful neighbor attacks another. “We will be in solidarity. But we will also make sure that our economically strong country copes with such a big challenge… Russia is using in the war not only weapons against Ukraine, but also energy supplies as a weapon. at the international level,” said the head of government.
Scholz noted that after the destruction of the Nord Stream gas pipeline, one can say that there will be no gas supplies from Russia in the foreseeable future, but Germany is well prepared for such a development of events. At the same time, the goal is to reduce energy prices.
“To reduce prices, we are now introducing a large “protective shield” from the economic stabilization fund, which will reach 200 billion euros,” said Scholz.
German Economy Minister Robert Gabeck specified that the amount of 200 billion euros was calculated for the period until the end of winter – until March or April 2024.
Scholz announced the introduction of a mechanism for slowing down gas prices for both private users and industry in the near future.
Recall that at the end of August, inflation in Germany broke a 50-year record, at that time it was 8.7%.
It was previously reported that the war in Ukraine will affect the global economy more than expected.
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.