The inflation rate in Germany according to preliminary Figures, in July negative. As the Federal Statistical office on the Basis of a first estimate told, the decline in consumer prices compared with the previous month by 0.1 percent. The inflation rate was, among other things, by the since 1. July 2020, the current VAT reduction, influenced, informed the office more.Finally, the monthly inflation rate in Germany in April 2016 was negative.
From the detailed inflation of the Federal States show numbers that heating oil and fuels were compared to the previous year, cheaper. Foods such as fruits, vegetables, but also meat were more expensive. But also the prices for clothing declined apparently. In the run-up had been speculation about a possible discount battle in the German clothing retail sector as a result of the Corona-crisis. After the end of the lock downs, a lot of clothing had advertised transactions with significant discounts for 30, 50 or even 70 percent.
Incomplete pass-through of the tax cut
to give the German economy in the Corona-crisis, new thrust, Hatt Eder Federal legislator lowered the VAT for the term from the beginning of July to the end of the year. Retailers and service providers, whether and how they give the option to lower VAT on to the consumer.
How strong is this happening, there is, as yet, only estimates. Holger Schmieding, the chief economist of the Hamburg-based Berenberg, has to pay on the basis of the Inflation for the North Rhine-Westphalia, roll over, and that, in fact, seems a little more than half of the VAT reduction had been give. "A look at the detail numbers from NRW suggests that the effect on inflation has rate, as expected, in the case of a percentage point," said Schmieding of the F. A. Z. "Finally, on the Basis of the present data, of course, still do not judge." In the case of full disclosure to the customer of the VAT effect would have represented approximately 2 percentage points.
Commerzbank Also comes to an effect on Inflation due to the VAT reduction of approximately one percentage point, however, rather scarce. "The apparently incomplete pass-through of the VAT reduction is not an economic Problem. Because it supports the profits of the company, are due to Corona under the wheels,“ said Jörg Krämer, the chief economist of Commerzbank.
inflation rate for food is exceptionally high
rates Now a significant part of the countries of the Euro area has a negative monthly inflation. According to the European Central Bank in June, nine in may, it had been even twelve States. The goods in June, Cyprus, Estonia, Greece, Ireland, Italy, Latvia, Luxembourg, Slovenia and Spain,in may, in addition, Belgium, Finland, Portugal.Updated Date: 30 July 2020, 13:19