Inflation in Germany has slowed somewhat for the second month in a row. At 7.2 percent, annual inflation remained at a comparatively high level in April, according to initial calculations by the Federal Statistical Office. According to the Wiesbaden authorities on Friday, consumer prices rose by 0.4 percent from March to April of the current year.
In March, the annual inflation rate in Germany, at 7.4 percent, fell below the eight percent mark for the first time since August 2022. High inflation is a challenge for consumers: it saps their purchasing power, people can afford less for one euro.
People want to shop less often
Based on a recent survey, the consulting firm Simon-Kucher found that people “continue to put the brakes on costs”. According to this, almost half of the 1,300 people surveyed in Germany want to shop less frequently (44 percent) or less (45 percent) in the next twelve months.
According to official figures, the rise in energy prices picked up again in April. According to calculations by the Federal Office, the price of energy rose by 6.8 percent compared to the same month last year, after growth of 3.5 percent in March and plus 19.1 percent in February. The federal government is trying to make natural gas, electricity and district heating more affordable by applying price brakes retroactive to January 1st.
Fewer price increases planned
According to a survey by the Ifo Institute, fewer companies are planning price increases for the next three months than recently. “The wave of price increases is likely to have already passed its apex,” analyzed Ifo economics chief Timo Wollmershäuser. The focus of the price increases remained on retail and consumer-related services such as restaurants and hairdressers. “Therefore, inflation should only drop very slowly in the coming months,” predicted Wollmershäuser.
The European Central Bank (ECB) is trying to dampen inflation with higher interest rates. Because higher interest rates make loans more expensive, which can slow down demand. The central bank is aiming for stable prices overall for the euro area with an inflation rate of two percent. After six interest rate increases in a row, the key interest rate in the euro area is 3.5 percent. Another hike is expected at the next ECB meeting on May 4th. (dpa)