Without government relief, inflation would be over ten percent

According to experts, inflation would have been even higher in recent weeks without government measures such as the nine-euro ticket.

Without government relief, inflation would be over ten percent

According to experts, inflation would have been even higher in recent weeks without government measures such as the nine-euro ticket. According to a report published on Wednesday, economists at the German Economic Institute (IW) calculated that the harmonized index of consumer prices (HICP) without government intervention in June would have been 10.2 percent, two percentage points above the level actually determined.

"Above all, relief such as the nine-euro ticket should be decisive," explained the IW researchers. “Passenger transport accounts for a large proportion of the shopping basket used to calculate inflation.” The “Bild” newspaper first reported on it.

The HICP is based on a calculation method developed by the EU in order to be able to compare inflation rates in the member countries. Accordingly, the inflation figure of 8.2 percent given for June deviates slightly from the calculations of the Federal Statistical Office, which had given the inflation rate at 7.6 percent.

In an EU comparison, Germany is now doing relatively well thanks to the aforementioned special effect, the IW experts explained. "Only Malta, France and Finland recently recorded lower inflation rates." The EU average was 9.6 percent in June.

The scientists warned, however, that the nine-euro ticket in the fall could also lead to further increases in prices. "The transport companies and the railways assume that the state compensation does not cover their costs," says the IW report. “Together with rising energy prices, this could mean that not only ticket prices will rise significantly from September, but also inflation.”

"Of course, in the short term, it's gratifying that inflation isn't rising even more," said study author Melinda Fremerey. "However, such relief is not a long-term solution." In order to cushion inflation, she spoke out in favor of one-off payments such as the flat-rate heating fee.

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