The German government’s statistics office (FSO) has reported that the index of wholesale prices in Germany rose 10.6% year-on-year in January and increased by 0.2% month-on-month. This is a positive sign for the country’s economy, as the index had slipped from its April high of 23.8% year-on-year in 2022.
The report shows that the rise in wholesale prices was primarily driven by a 16.2% year-on-year increase in food, beverage, and tobacco prices in January. The strong demand and supply chain issues are causing this increase.
The increase in wholesale prices could lead to higher prices for consumers if retailers decide to pass on the increased costs. Higher prices could lead to inflationary pressures, which the European Central Bank would have to address.
Wholesale prices are considered an important indicator of inflation as they are the prices that businesses pay for goods and services. The rise in wholesale prices could be an indication that inflation is on the rise in Germany, which would be a concern for the country’s policymakers.
However, for now, the rise in the wholesale price index is seen as a positive development for the German economy as it reflects an increase in demand for goods and services. The government will be hoping that this trend continues and that it will help to boost economic growth in the coming months.