German food prices rose by 2.2 percent
After the VAT cut expired, inflation in Germany jumped at the beginning of the year. In January 2021, consumer prices were 1.0 percent above the level of the same month last year, according to the Federal Statistical Office. In December, the inflation rate was still minus 0.3 percent, most recently it was positive in June at 0.9 percent.
Compared to December, consumer prices rose by 0.8 percent. The Wiesbaden authority confirmed preliminary data.
The lower VAT rates of 16 and 5 percent respectively, introduced for half a year to boost consumption in the corona crisis, expired at the end of last year.
In addition to the end of the VAT cut, according to the statisticians, the CO2 levy of 25 euros per tonne of carbon dioxide (CO2) emitted when diesel, petrol, heating oil and natural gas was burned at the beginning of the year also had an impact on prices.
For food in particular, consumers had to dig deeper into their pockets in January than a year earlier (plus 2.2 percent). At the same time, the price decline for energy products slowed. They were cheaper by 2.3 percent. In December, energy had cost 6.0 percent less than a year earlier.
