The inflation rate in Hesse rose to 3.4 percent in July.

The change in consumer prices compared to the same month last year has reached the highest value since September 2008, as the State Statistical Office announced on Thursday in Wiesbaden.

In June 2021, the inflation rate was 2.2 percent.

However, the sudden increase is largely due to the fact that VAT was reduced in July 2020, explained the experts.

As a result, the price level fell significantly in the second half of 2020, and the current rates of change compared to the same month last year were correspondingly higher.

"This effect is expected to shape the monthly inflation rates in the entire second half of 2021," said the state office.

Compared to June 2021, consumer prices increased by 0.8 percent in July 2021.

Without taking energy prices into account, the inflation rate in Hesse would have been 2.4 percent in July 2021, explained the state office.

Compared to July 2020, energy has increased by 12.8 percent - the prices for heating oil (plus 56.1 percent) and fuels (plus 26.9 percent) rose in particular.

Consumers had to spend 3.8 percent more on food within a year.

Against the trend of fewer unemployed

In order to give the German economy a boost in the Corona crisis, the federal government had temporarily reduced VAT from July 1, 2020 to December 31, 2020.

The regular tax rate decreased from 19 percent to 16 percent, the reduced tax rate from 7 percent to 5 percent.

The race to catch up on the Hessian labor market continues after the corona slump.

Contrary to the long-term trend, the number of unemployed also fell in July, as the regional directorate of the employment agency reported on Thursday in Frankfurt.

As of July 13th, 176,579 women and men were registered as unemployed.

That was 0.6 percent less than in the previous month and 13.5 percent less than in July of the previous year.

The unemployment rate remained unchanged at 5.1 percent.

"The current figures suggest a significant recovery in the Hessian labor market," said Frank Martin, head of the management. The number of new jobs has already exceeded the pre-crisis level and a large part of the sectors are reporting increasing numbers of employees, which would offset job losses, for example in the hospitality and industry.