The inflation rate in Germany has risen again.

According to an initial estimate by the Federal Statistical Office on Monday, it was 3.9 percent in August.

In July it was 3.8 percent, which also meant a jump in prices compared to June with 2.3 percent.

Christian Siedenbiedel

Editor in business.

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The price increase in August was the highest in Germany for almost 30 years.

The last time there was a stronger rise in prices was in the period after German reunification - in December 1993 with 4.3 percent at the time.

Petrol, in particular, has recently become much more expensive.

During the travel wave, Super cost 1.80 euros per liter at some car filling stations.

On average, drivers recently paid 1.56 euros for a liter of Super and 1.39 euros for diesel - considerably more than last year.

The reasons for the sharp rise in the price level recently include the peculiarities of the corona pandemic. Last year, for example, oil was particularly cheap because of the lockdown. That makes the price increase for energy seem particularly strong now. In addition, a CO2 price for petrol and heating oil was introduced at the turn of the year, which also drives prices up. In addition, in the period from July to December 2021, prices from the previous year with the lower VAT will be compared with those with the higher tax rate from this year. This also increases the inflation rate.

The Bundesbank still expects monthly inflation rates "in the direction of 5 percent" over the course of the year, before inflation is likely to be lower again in the coming year.

The investment bank Goldman Sachs sees it similarly, according to information from Europe's chief economist Jari Stehn.

"There is a relatively high probability that inflation will fall again next year - there is more uncertainty about how deep it can then fall." Majority, however, with at least constant or rising inflation rates.  

Salad and tomatoes significantly more expensive than in July

The detailed inflation figures at the state level from North Rhine-Westphalia show more precisely what has become expensive.

Compared to July 2021, prices for lettuce or iceberg lettuce (plus 22.4 percent) and tomatoes (plus 8.3 percent) in particular rose.

On the other hand, paprika (minus 14.1 percent) and grapes (minus 9.0 percent) were offered more cheaply.

Compared to the same month last year (August 2020), petroleum products in particular (plus 32.6 percent), including heating oil including levy (plus 26.7 percent) and fuels (plus 28.8 percent), were offered more expensive.

The prices for hotel stays rose by 2.4 percent, the restaurant prices rose by 4.1 percent.

Ice cream (minus 3.8 percent) and hard cheese (minus 2.4 percent) were particularly cheaper than a year ago.

Three interesting developments

The economist Holger Schmieding mentions three developments that are interesting from his point of view: “Firstly, package tours in August were 1.5 percent more expensive than in the previous year; in July the year-on-year rate was minus 0.5 percent after minus 5.0 Percent in June and plus 7.4 percent in May, ”he says.

The strong fluctuations compared to the previous year are probably mainly due to changing vacation dates.

Second, the price pressure on clothing has subsided.

The annual comparison rate decreased from 6.7 percent in July to 4.5 percent in August, and for men's clothing even from 7.9 to 3.7 percent.

"This is mainly due to the fact that in the previous year the pandemic had badly mixed up the usual seasonal pattern of sales," said Schmieding. 

Thirdly, food has become somewhat more expensive, with the rate accelerating from 4.2 percent in July to 4.4 percent in August.

“These are short-term effects that reflect the seasonal supply of individual foods,” says Schmieding.

Wages rise less than prices

Meanwhile, the Federal Statistical Office continues to report that collectively agreed wages rose less sharply than prices in the first quarter.

Including the fixed


special payments, earnings increased by 1.9 percent compared to the same period of the previous year.

Consumer prices rose 2.4 percent in the same period, resulting in real wage losses for employees.

In the previous quarter, the 1.3 percent increase in income had offset inflation.

The inflation rate in Spain also continued to rise: In August, consumer prices calculated using the European method rose by 3.3 percent


compared to the same month last year, according to the INE statistics office in Madrid on Monday. The statisticians justified the increasing inflation mainly with


rising energy prices.