Technology Inflation: Rising consumer prices: The wallets are still "well filled"
Drug prices are declining amid inflation fears
Statistics indicate consumer prices for prescription drugs in pharmacies and drug stores fell 1.8 percent since April 2020.Inconveniently, prescription drug prices, in fact, have been falling. BLS data indicate consumer prices for prescription drugs in pharmacies and drug stores fell 1.8 percent in the 12 months ending April 2020, and this April were 3.1 percent below a peak in December 2019. Importantly, drug prices currently are similar to those of summer 2017, indicating negligible drug price inflation over close to four years.
of the consumer should become the driving force of the upswing. But what happens with the consumption of the Germans, when inflation increases?
for Rolf Bürkl is clear: "We leave the lockdown more and more behind us," says the consumer expert of the Nuremberg Market Research Institute GfK. This is also reflected in the mood of consumers: For the consumer climate, the Institute for July predicts a value of minus 0.3 points - the highest value since the summer 2020. In June of last year, the value was still at minus 6.9 points .
"The mood of consumers is optimistic," says Bürkl. Economic colleague Timo Wollershäuser, economic conveyer of the Münchnerifo Institute, is safe: "Consumption is the supporting pillar of recovery in Germany."
White House: Markets showing little worry about inflation
The White House believes it has an ally in the bond markets to make the case that inflation isn't an economic threat. Republican lawmakers have interpreted the jump in consumer and producer prices as a sign that inflation is spiking at levels that will hurt growth, saying that President Joe Biden's $1.9 trillion coronavirus relief package overcooked the economy. But the financial markets appear to be backing Biden's case that any price increases are the fleeting result of the United States restarting after the lockdowns caused by the coronavirus pandemic.
But there is a factor that could brake the consumption boom expected by many experts in the second half of experts - the Inflation rising for months. On the 29th of July, the Federal Statistical Office issues a first estimate for the month of July, and analysts then expect a renewed increase. In June, the inflation rate was 2.3 percent after preliminary calculations at 2.3 percent, after it had been located in December at minus 0.3 percentage points. The statistical office wants to publish the final value for the past month today on Tuesday.
Timo Wohlmershäuser, economic transit of the Münchnerifo Institute, calculates that the inflation rate driven by special effects - in October or November will even rise to more than four percent. Only 2022 inflation will then go back to about two percent.
Yellen confident rising inflation won't be 'permanent'
Treasury Secretary Janet Yellen sought to assure lawmakers Wednesday that historically high inflation would cool off as the U.S. economy continues to rebound from COVID-19.Testifying before the Senate Finance Committee, Yellen said that while she was keeping a close eye on rising inflation, she doesn't "anticipate that it will be permanent."Yellen reiterated what she, Federal Reserve Chairman Jerome Powell, and many economists have said about the recent surge in prices from pandemic lows.
Video: Felt inflation on maximum for 9 years (Glomex)
An increasing inflation rate has a negative effect on consumer mood, says consumer expert Bürkl. This showed the experiences of the past 30 years. However, "the financial reserves for many consumers are so high that the pain threshold is higher at rising prices," the consumption expert believes.
Because people in Germany have saved last year as the world champions - mostly necessary. Travel fell, shops and restaurants were allowed to offer their service for weeks only limited. Bürkl: "The wallets are well filled".
Similarly, if IFO Economic Wollershäuser sees: "If wages do not keep up with the prices, we lose purchasing power - and if prices rise strongly for a long period of time than wages, that will burden the consumption." This effect is " Significantly lower than the positive consumption effect due to the overreparitation of households accumulated in Coronaziten. There are huge upholding effects. "
Five years of price hikes show the scope of inflation's surge
Recent price surges forecast that the worst is yet to come, should federal policy continue on its current path. Add the post-pandemic loose fiscal policy, plus the injection of trillions of new dollars from the Federal Reserve to the unemployment bonus scheme crushing crucial supply chains, and we have all of the makings of a medium- to long-term crisis.Many economists are blaring a contradictory set of projections for the next year. Turn on CNBC or read the business pages of most publications, and there are predictions of both a hot economy and tame inflation.
According to calculations of the Deutsche Bundesbank, the cash assets of private households in Germany was at the end of 2020 on the record value of almost seven trillion euros - an increase of almost seven percent compared to the end of 2019.
the savings rate climbed during Lockdown to more than 20 percent, in the first quarter of 2021, it was 23.2 percent, according to the Federal Statistical Office. That means: From 100 euros available income, households put 23 euros on the high edge. For comparison: In 2019, the quota was 10.9 percent. Therefore,
Bürkl does not expect that inflation sustainably spoils the dealers on the dealers - 2022 will probably continue to "gain consumption".
More about: Fear of the delta variant, exploding prizes, weakening stocks, decreasing orders: The risks for the economy rise again. How stable is our upswing?
Inflation rate scratches at the four-percent mark .
Germany's consumer must cope with a further price increase. With 3.9 percent in August in August, the inflation rate in Europe's largest economy scratches for the first time for almost 30 years at the four-percent mark. © Fabian Sommer / DPA High prices for energy drive inflation in Germany upwards. from July On August 2021, the level of consumer prices stagnated, as the Federal Statistical Office announced on Monday on the basis of preliminary calculations.