Germany Inflation Hits Record Highs As Energy Prices Surge

New Delhi (CoinChapter.com): The German Consumer Price Index (CPI) reached an all-time high in September, according to the latest data released by Destatis. The rising prices of Energy and Food played a significant role in this change.

Consumer price inflation is up yearly to 10% in September from 7.9% in August. The rate is in line with the flash estimate, and it’s due to increasing energy prices due to the war in Ukraine and supply bottlenecks.

The “9-euro ticket” scheme and the fuel discount ended in September. This caused a spike in food prices, with inflation of 18.7%, and then fell back by 4.6% without food and energy on the inflation index.

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Transport costs grew by 14.0% in September, following a 3.7% rise in August. Prices of goods and services were up 17.2%.

The European Union’s harmonized inflation jumped to 10.9%, similar to the estimate, from 8.8% in the previous month. Germany’s Bundesbank expects the EU’s harmonized inflation rate to stay in double-digit territory for the next few months.

Consumer prices gained 1.9% in the month, Destatis reported. The consumer price index increased by 2.2% after rising 0.4% in August.

Germany Is On Its Way To Recession

President of the German Bundesbank, Joachim Nagel, told a German newspaper that persistently high inflation is the biggest drag on economic growth. He went on to say that interest rates need to rise further in order for inflation to go down.

The central bank chief believes that Germany is on its way to a recession.

The Bundesbank expects economic growth in Germany to be between 1.3% and 1.5%. They predict a flat path for the year 2023.

The European Central Bank is expected to raise its key interest rate again by 75 basis points at its late October meeting. The move comes as eurozone inflation rises to 10.0%. It’s the first time on record that Europe’s inflation has been at a double-digit rate.

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