Federal Statistical Office Reports Inflation Surge After End of Fuel Discount

Background: The Expiration of the Fuel Discount

According to the ADAC's assessment, another burdening factor comes into play: low water levels on central waterways such as the Rhine. The automobile club stated that low water levels on important transport routes such as the Rhine increase the logistics costs for the transport of fuels and individual intermediate products in some cases significantly. This makes both the fuels themselves and their intermediate products, which are delivered to refineries via inland shipping, more expensive.

The central bank and the federal government are monitoring the development with a view to monetary policy and possible relief measures. If price pressure solidifies, noticeable losses in purchasing power threaten for private households, particularly for lower-income families, who spend a disproportionate share of their budget on mobility and energy.

ADAC: Low Water Makes Transport More Expensive

International risks are further aggravating the situation. Tensions in the region around the Strait of Hormuz as well as geopolitical upheavals connected to Iran had repeatedly driven up crude oil prices on world markets in recent weeks. Energy prices are also under increased pressure in this environment.

International Risks Press on Prices

For the coming months, economists expect the inflation rate to decline only slowly, if at all. A lasting easing could only occur once energy prices on world markets stabilize and the domestic economic effects of the fuel discount's end are fully priced in.

Consumers can expect higher expenses when refuelling and shopping in the short term. In the medium term, price developments will depend on how international energy policy and weather patterns in Europe evolve, which co-determine transport costs via river water levels.

Outlook on Further Development

The Federal Statistical Office, led by Ruth Brand, announced that it will monitor price developments closely in the coming months. Economists and business associations expect the inflation rate to recede only gradually over the rest of the year, provided no new external shocks arise.