Experts warn of “unbelievable price hammer”

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Experts warn of "unbelievable price hammer"

In August, producer prices in Germany rose by 45.8 percent. This is the highest cost increase since the survey began in 1949. Consumers face even higher prices if companies pass on the significantly higher costs to them.

Producer prices have risen more than ever

Since the beginning of the Federal Republic, producer prices have not risen as much as in August 2022. Prices went down by a whole 45.8 percent year-on-year up after a 7.9 percent increase for producers in the previous month.

Depending on the area, the prices have developed very differently. Crucial to the new record are oil, gas and electricity and other forms of energy. According to figures from the Federal Statistical Office, there has been more than a doubling in comparison to the previous year: Producer prices went up by 139 percent. An even higher increase of 174.9 percent has been observed for electricity.

Electricity could become even more expensive in the coming year:

Excluding the energy sector the numbers are looking much better, but a 14.8 percent year-on-year increase should still be felt by consumers, as producers pass the price increase on to customers. After all, the trend is slightly downward if energy prices are left out.

For inflation, the reported readings are far from good news. According to Jens-Oliver Niklasch from Landesbank Baden-Württemberg, it is an “incredible price hammer”. Inflation was “here to stay” (source: Welt). Producer prices are used as precursors for the development of general inflation.

A balcony power plant is worthwhile to reduce electricity costs:

Producer prices: further boost in September

Experts do not expect relief in September. After both the tank discount and the 9-euro ticket expired at the end of August, a further boost can be expected. Among other things, the Deutsche Bundesbank is expecting one in the next few months even higher inflation rate out.

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