Life is becoming more expensive for many: inflation is almost at the pre-crisis level

Friday March 12th 2021

Life is becoming more expensive for many
Inflation is almost at pre-crisis levels

Fuel, gas, heating oil, food, housing – life became significantly more expensive for Germans again in February. With an increase of 1.3 percent compared to the same month last year, the inflation rate is almost as high as it was before the corona pandemic, according to the Federal Statistical Office.

Consumer prices rose by 1.3 percent in February compared to the same month last year. The Federal Statistical Office thus confirmed the first estimates made at the beginning of March. Compared to January of this year, inflation rose by 0.7 percent. The rate has "almost reached the pre-crisis level again," said the statisticians. In January, prices were up 1.0 percent year-on-year.

In particular, fuels (plus 2.4 percent), natural gas (plus 2.1 percent) and heating oil (plus 1.1 percent) have now become more expensive. In addition to the CO2 levy introduced at the beginning of the year, the price increase on the crude oil market also had an effect, as the Federal Office explained. In February consumers had to spend 1.4 percent more money on food than in the same month last year. Confectionery and dairy products, for example, have become more expensive, while cell phones have become significantly cheaper.

The prices for services as a whole were 1.4 percent above the level of the same month last year in February 2021, as the Federal Statistical Office further explained. The price of net rents without heating increased by 1.3 percent.

The expiry of the VAT cut at the end of 2020 also played a part in the rise in inflation. As a result, consumer prices had already risen significantly in January. The federal government had lowered the value added tax for half a year in the fight against the consequences of the corona crisis.

At the beginning of March, the ADAC had already referred to the recent noticeable increase in fuel prices. From January to February, both gasoline and diesel rose in price by 4.3 cents per liter each. The reason for this is again the increased price of crude oil.