The Federal Statistical Office reported on Thursday that inflation had fallen in this country. The European counterpart, on the other hand, presents other figures. Inflation continued to rise in the eurozone, including in Germany.
Eurozone inflation accelerated in July, hitting another record high. Compared to the same month last year, consumer prices increased by 8.9 percent, according to the statistics office Eurostat. This is the highest rate since the euro was introduced as book money in 1999. In the previous month, consumer prices rose by 8.6 percent. Experts had expected an acceleration to 8.7 percent.
In Germany, the inflation rate calculated according to European standards was 8.5 percent. On Thursday, however, the Federal Statistical Office only reported inflation of 7.5 percent. The reason for this is the different calculation methods. It is striking that the German statistics show a slight decline (from 7.6 percent), while the European version shows a slight increase (from 8.2 to 8.5 percent) for Germany.
Inflation was again driven by energy prices, which rose by 39.7 percent compared to the same month last year. However, the increase was somewhat weaker than in the previous month. On the other hand, the rise in prices for food and beverages accelerated from 8.9 to 9.8 percent. Core inflation, which does not take into account prices for energy, food and luxury goods that are particularly susceptible to fluctuations, rose from 3.7 to 4 percent. The three Baltic states again had the highest inflation rates in the currency area at more than 20 percent.
Despite record inflation and the Ukraine war, the economy in the euro zone grew more significantly than expected in the spring. Between April and June, gross domestic product (GDP) increased by 0.7 percent compared to the previous quarter, as also reported by Eurostat. Economists, on the other hand, had only expected an increase of 0.2 percent for the second quarter.
At the beginning of the year, there was only a plus in GDP of 0.5 percent. Compared to the same period of the previous year, economic output rose by 4.0 percent in the spring. Germany was not really a growth engine. According to the Federal Statistical Office, the economy in Germany stagnated between April and June compared to the previous quarter.
Just over a week ago, the European Central Bank raised its key interest rates for the first time in eleven years. Compared to other central banks, the ECB’s reaction is late, although its inflation target of two percent has been clearly exceeded for a long time.
