Inflation at lowest level since february 2018
Lower energy prices have pushed inflation in germany to its lowest level in 19 months. Consumer prices rose by 1.2 percent in september compared to the same month last year, according to the federal statistical office, based on preliminary data.
According to the wiesbaden authorities, the last time the rate was lower was in february 2018, when it was 1.1 percent. Compared to august 2019, consumer prices remained unchanged in september.
For household energy and fuel, people in germany had to pay an average of 1.1 percent less than in the same month last year. In addition, the rise in food prices weakened. They increased by 1.3 percent. In august, the increase had still amounted to 2.7 percent.
The inflation rate is an important indicator of the european central bank's (ECB) monetary policy. The central bank is aiming for an annual tax rate of just under 2.0 percent for the euro zone as a whole, with its 19 countries, in the medium term – far enough away from the zero mark. Because permanently low prices or prices falling across the board could tempt companies and consumers to postpone investments. This may slow down the economy.
The HICP price index for germany, which is calculated for european comparative purposes and used by the ECB for its monetary policy, was 0.9 percent higher than in september 2018. In the euro area, annual inflation had been 1.0 percent in august, according to the latest data from the statistics agency eurostat.
In view of the economic slowdown and comparatively weak inflation, the european central bank (ECB) had recently eased its monetary policy. A rise in interest rates longed for by savers is a distant prospect. The central bank also charges banks not only higher penalty interest rates if they park money at the central bank. Starting in november, it will also invest 20 billion euros a month in bond purchases – for an unlimited period of time.
The development is bitter for savers. Because daily allowance and co. Yielding hardly anything. According to calculations by comdirect bank, the real interest rate – i.E. The actual interest rate for savings deposits after deducting the rate of inflation – was minus 1.30 percent in the third quarter of 2019. Savers lost 7.7 billion euros in the period from July to September alone.
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