The President of the German Institute for Economic Research (DIW), Marcel Fratzscher, anticipates a short-term rise in inflation for Germany by the end of the year and a subsequent easing.
“I assume that inflation could move up to 5.0 percent by the end of the year,” said Fratzscher of the newspaper “Augsburger Allgemeine”.
However, according to the economist, the development should not be overestimated: "We are expecting an inflation rate of 3.0 percent for the entire year 2021, which is not dramatic."
The DIW assumes that Germany will rise by 2.5 percent in 2022.
The chances are good that inflation will level off again at around 2.0 percent.
"So we should keep a cool head and not fall into an inflation panic," said the DIW President.
Fratzscher also stated that without tax increases in Germany there would be no avoiding additional debt: "All the bills show us that the German state will need 50 billion euros every year for more climate protection and the expansion of digitization over the next ten years."