Energy Products in Germany Increase by Over 20% Driving the Inflation Rate Further

According to Germany’s Federal Statistical Office (Destatis), the consumer price index (CPI) rose by 4.9% year-on-year in January. This is slightly below the figures for December, when the inflation rate rose to 5.3%, which was the highest level in 30 years.

On a monthly basis, the consumer price index rose by 0.4% by German standards in January, in line with economists’ forecasts.

Dr. Georg Thiel, President of the Federal Statistical Office said, “The inflation rate weakened somewhat in January after reaching its highest level in almost 30 years in December. However, it remains at a high level.”

Prices for goods overall increased by 7.2% from January 2021 to January 2022.

Prices for energy products rose sharply by 20.5%. Within a year, fuel prices increased by 24.8% and prices for household energy by 18.3%. Among household energy products, the main increases were in light heating oil by 51.9%, natural gas by 32.2%, and electricity by 11.1%. The increases were mainly politically driven. CO2 taxes rose from 25 euros to 30 euros per metric ton of CO2, as did grid fees for electricity. In addition, geopolitical factors also played a role.

Household energy increased by 9.7% compared to the previous month, including natural gas by 22.8% MoM and electricity by 9.0% MoM.

Food prices rose by 5.0% year-on-year in January 2022. Fresh vegetables rose by 8.3%, dairy products, and butter by 6.3% while meat and meat products increased by 4.2%. Overall, food, energy, and other daily necessities increased by 9.6%.

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