German consumer prices 5 per cent above EU average

The level of consumer prices in Germany is 5 per cent above the European Union (EU) average, according to compiled figures published on Friday by the Federal Statistical Office, reports Xinhua from Berlin.

According to Eurostat data published by the Wiesbaden-based government agency, Germany ranked in the midfield of the countries assessed, ahead of Italy (1.1 per cent above average) and Spain (7.7 per cent below average), but still well behind Denmark (41.5 per cent above average), Luxemburg (26.9 per cent above average) and Sweden (25.4 per cent above average).

The highest price levels were measured in Iceland and Switzerland at 66 per cent and 59 per cent above the EU average, respectively. By contrast, the cost of living was found to be relatively low in the Czech Republic (31 per cent below average), Poland (43.8 per cent below average) and Bulgaria (51.6 per cent below average).

The findings underlined the persistence of stark inequalities with regards to consumer prices in the EU in spite of some progress towards economic convergence between the richer and poorer members of the bloc.

In part, the remaining gap in consumer prices owed to different levels of taxation imposed by member on goods such as tobacco and alcohol, as well as the differential cost of housing.

For example, rents, wine, beer and cigarettes in Bulgaria, the bottom-ranked EU country, were all around 50 per cent cheaper than the member state average.

By contrast, German tourists who spent one euro in a high-cost European Economic Area (EEA) country like Switzerland only received goods and services which would be worth 0.71 cents in their home country in return.

Speaking to Xinhua on Friday, Stefan Kooths at Kiel Institute for the World Economy predicted that German consumer prices would rise by “around two percent” in the course of 2018 as well as 2019.

“This is due to the strong economy. Demand for production capacities in many areas is far above average, for example in the construction industry, which is driving up prices,” Kooths said.

Referring to a series of tax cuts and increases in benefits that the German government is planning, Kooths expects “good situation on the labor market where employees can expect strong wage increases”.

 

German consumer prices 5 per cent above EU average

The level of consumer prices in Germany is 5 per cent above the European Union (EU) average, according to compiled figures published on Friday by the Federal Statistical Office, reports Xinhua from Berlin. According to Eurostat data published by the Wiesbaden-based government agency, Germany ranked in the midfield of the countries assessed, ahead of Italy (1.1 per cent above average) and Spain (7.7 per cent below average), but still well behind Denmark (41.5 per cent above average), Luxemburg (26.9 per cent above average) and Sweden (25.4 per cent above average). The highest price levels were measured in Iceland and Switzerland at 66 per cent and 59 per cent above the EU average, respectively. By contrast, the cost of living was found to be relatively low in the Czech Republic (31 per cent below average), Poland (43.8 per cent below average) and Bulgaria (51.6 per cent below average). The findings underlined the persistence of stark inequalities with regards to consumer prices in the EU in spite of some progress towards economic convergence between the richer and poorer members of the bloc. In part, the remaining gap in consumer prices owed to different levels of taxation imposed by member on goods such as tobacco and alcohol, as well as the differential cost of housing. For example, rents, wine, beer and cigarettes in Bulgaria, the bottom-ranked EU country, were all around 50 per cent cheaper than the member state average. By contrast, German tourists who spent one euro in a high-cost European Economic Area (EEA) country like Switzerland only received goods and services which would be worth 0.71 cents in their home country in return. Speaking to Xinhua on Friday, Stefan Kooths at Kiel Institute for the World Economy predicted that German consumer prices would rise by around two percent in the course of 2018 as well as 2019. This is due to the strong economy. Demand for production capacities in many areas is far above average, for example in the construction industry, which is driving up prices, Kooths said. Referring to a series of tax cuts and increases in benefits that the German government is planning, Kooths expects good situation on the labor market where employees can expect strong wage increases.