This archive report was first published on 30 September 2021.
Published on September 30, 2021, Germany's inflation rate accelerated for the third consecutive month, driven by a surge in energy prices.
According to the federal statistics agency Destatis, consumer prices in Europe's largest economy rose by 3.8% in August compared to the previous year.
The surge in inflation was attributed to a 'temporary value-added tax reduction' in Germany in 2020 to counter the economic impact of the coronavirus pandemic and a slump in oil prices in the same year.
Additionally, limited supply of natural gas has contributed to rising energy prices for consumers, as countries scramble to secure new shipments.
Energy prices are 'likely to remain high until the end of the year,' said Fritzi Koehler-Geib, chief economist at German public lender KfW.
European Central Bank chief Christine Lagarde has repeatedly stated that recent jumps pushing inflation above the bank's two percent target were due to temporary factors.
