In view of price increases announced by German companies, the Ifo Institute does not see an end to the high inflation anytime soon. According to a survey by the Munich researchers, many companies want to raise their prices on a large scale. In August, the Ifo index of price expectations was 47.5 points, just 0.1 below the July value. In individual areas such as the food industry, almost every company wants to continue raising prices. “Unfortunately, there is no end in sight to the wave of inflation,” said Ifo economic chief Timo Wollmershäuser.
On the contrary: In the coming months, he even expects higher inflation rates: “So far, energy suppliers have only passed on a small part of the sharp rise in exchange prices for electricity and natural gas to customers,” said Wollmershäuser. “That is likely to change in the coming months and lead to double-digit inflation rates. Consumers will therefore limit their consumption and overall economic output will shrink in the second half of the year.”
A price expectation of 47.5 means that the proportion of firms that want to raise prices is 47.5 percentage points higher than the proportion of firms that want to lower prices. The numbers are currently particularly high in retail, and the lowest in the main construction trades. (dpa)