Press release No. 377 of 11 August 2021
Consumer price index, July 2021
+3.8% on the same month a year earlier (provisional result confirmed)
+0.9% on the previous month (provisional result confirmed)
Harmonised index of consumer prices, July 2021
+3.1% on the same month a year earlier (provisional result confirmed)
+0.5% on the previous month (provisional result confirmed)
WIESBADEN − The inflation rate in Germany, measured as the year-on-year change in the consumer price index, stood at +3.8% in July 2021. The inflation rate has thus surged; in June 2021 it had been +2.3%. A higher inflation rate than in July 2021 was last measured in December 1993 (+4.3%). The Federal Statistical Office (Destatis) also reports that consumer prices were up 0.9% on June 2021.
Base effect caused by VAT rates starts to have an impact in July 2021
As a consequence of the temporary reduction of VAT rates (from July 2020 to December 2020), consumer prices had fallen sharply in July 2020. The low price level of a year ago now had an upward effect on the price development for many goods and services and, consequently, on the overall inflation rate. “The sudden base effect occurring in July 2021 had been expected as the tax reduction had been passed on to consumers a year ago, involving price decreases for many products. The upward effect on prices is augmented by special developments for some products, in particular energy products”, said Christoph-Martin Mai, Head of the Consumer Prices Section at the Federal Statistical Office.
Substantial increase in energy prices of 11.6% compared with a year earlier
The prices of goods (total) increased by 5.4% between July 2020 and July 2021, which was above average. Especially the increase in Energy product prices (+11.6%) was markedly higher than overall inflation. The price increase for such products accelerated again (June 2021: +9.4%). In addition to the price trend of a year ago (base effect) and the CO2 charge introduced at the beginning of the year, the increasing inflation rate was also attributable to the current rise in energy prices. Prices were up especially for heating oil (+53.6%) and motor fuels (+24.7%). The prices of natural gas (+4.7%) and electricity (+1.6%) rose, too.
Food prices in July 2021 were up 4.3% on the same month a year earlier, following +1.2% in June 2021. Marked price increases on July 2020 were recorded, for example, for vegetables (+7.2%) and edible fats and oils (+6.9%). As regards goods, marked price rises were also observed for clothing (+6.2%) and vehicles (+5.2%) as well as furniture and lighting equipment (+4.0%). Prices were slightly down, among other things, for mobile phones (-2.9%).
Inflation rate excluding energy at +2.9%
The year-on-year increases in energy product prices and food prices had a clear upward effect on the inflation rate. Excluding energy prices, the inflation rate would have been just +2.9% in July 2021; excluding the prices of both product groups, it would have been +2.7%.
Service prices up 2.2% year on year
The prices of services (total) increased by 2.2% in July 2021 compared with the same month a year earlier. Net rents exclusive of heating expenses, which are important as they account for a large part of household final consumption expenditure, rose by 1.4%. Larger price increases were observed, among other things, for services of social facilities (+5.1%), maintenance and repair of vehicles (+4.9%) and for catering services in restaurants, cafes and the like (+3.6%).
Prices up 0.9% on the previous month
Compared with June 2021, the consumer price index rose by 0.9% in July 2021. Energy product prices were up 1.3%, especially the prices of heating oil (+3.0%) and motor fuels (+2.6%). In addition, in the holiday month of July, seasonal price rises were recorded for overnight stays (+1.8%) and especially package holidays (+22.1%); the range of such services offered was still restricted.
The prices of food (total) rose by 0.4%. Prices of vegetables, for example, increased (+1.1%), whereas prices of fruit were down (-1.2%). The prices of clothing and footwear were also down (-2.4%), which was mainly due to seasonal reductions in the prices of summer articles.
Methodological note:
The further year-on-year increase of the inflation rate in July 2021 is caused, in particular, by base effects. The value-added tax rates were reduced from July to December 2020 on account of the coronavirus crisis. At the same time, there are other price effects such as CO2 pricing and the usual market developments. For more background information and analyses regarding the consequences of the coronavirus pandemic for price development please refer to our “StatGespräch” podcast on inflation (in German). Here we shed light on the role of base effects and the future of price collection.
The situation of price collection caused by the corona crisis was getting less tense in July 2021 as the shop-based retail business and food service and accommodation establishments were largely open or could offer their services again. For information on the consequences of the lockdown for price collection please refer to our methodological paper on the impact of the coronavirus pandemic on price collection. The quality of the results of consumer price statistics remains unaffected.
The coronavirus pandemic, the associated restrictions on public life and the resulting consequences required a changed approach to the annual updating of the product weights used in the harmonised index of consumer prices (HICP). A methodological paper which discusses this issue is provided on the webpage of the Federal Statistical Office. The updating of the HICP product weights explains a considerable part of the difference between the CPI and the HICP for Germany.
The consumer price index results are also available on the Corona Statistics webpage of the Federal Statistical Office together with other indicators which can be used to assess the economic consequences of the coronavirus pandemic.
Crisis Monitor enables comparison between corona crisis and financial and economic crisis
The consumer price index also forms part of the Crisis Monitor (www.destatis.de/krisenmonitor), by means of which the Federal Statistical Office compares the development of major short-term indicators in the corona crisis and the financial and economic crisis of 2008/2009. The Crisis Monitor complements the Corona statistics webpage (www.destatis.de/corona), which provides statistical information on the economic and social consequences of the coronavirus pandemic.
| Overall index / subindex | Weighting | Index 2015 = 100 | Change on the same period a year earlier | Change on the preceding month |
|---|---|---|---|---|
| in per mill | in per cent | |||
| 1: Results do not include charges. | ||||
| Overall index | 1,000.00 | 110.1 | 3.8 | 0.9 |
| Food and non-alcoholic-beverages | 96.85 | 113.3 | 4.3 | 0.3 |
| Food | 84.87 | 114.1 | 4.3 | 0.4 |
| Meat and meat products | 18.60 | 117.8 | 3.2 | 0.9 |
| Fruit | 8.88 | 116.0 | 2.3 | -1.2 |
| Vegetables | 11.08 | 114.6 | 7.2 | 1.1 |
| Alcoholic beverages and tobacco | 37.77 | 117.2 | 2.3 | 0.1 |
| Clothing and footwear | 45.34 | 102.6 | 5.0 | -2.4 |
| Housing, water, electricity, gas and other fuels | 324.70 | 107.9 | 2.4 | 0.3 |
| Net rent exclusive of heating expenses | 196.32 | 108.6 | 1.4 | 0.1 |
| Household energy | 68.82 | 104.1 | 5.4 | 0.6 |
| Electricity | 25.92 | 111.1 | 1.6 | -0.1 |
| Gas 1 | 13.53 | 99.6 | 4.7 | 0.2 |
| Heating oil 1 | 7.01 | 120.1 | 53.6 | 3.0 |
| Furniture, lighting equipment, appliances and other household equipment | 50.04 | 104.9 | 3.1 | 0.3 |
| Health | 46.13 | 105.8 | 0.6 | 0.1 |
| Transport | 129.05 | 114.4 | 9.8 | 1.6 |
| Motor fuels | 35.01 | 116.5 | 24.7 | 2.6 |
| Supergrade petrol | 25.66 | 115.3 | 23.8 | 2.8 |
| Diesel fuel | 8.64 | 120.0 | 27.5 | 2.0 |
| Communication | 26.72 | 94.2 | 1.0 | 0.0 |
| Recreation and culture | 113.36 | 113.9 | 2.6 | 5.4 |
| Package holidays | 26.62 | 133.3 | -0.5 | 22.1 |
| Education | 9.02 | 104.4 | 2.0 | 0.1 |
| Restaurant and accommodation services | 46.77 | 115.9 | 3.3 | 0.5 |
| Miscellaneous goods and services | 74.25 | 111.6 | 3.4 | 0.3 |
| Overall index | ||||
| Excluding food and energy | 811.30 | 109.9 | 2.7 | 0.9 |
| Excluding energy (household energy and motor fuels) | 896.17 | 110.3 | 2.9 | 0.9 |
| Excluding heating oil and motor fuels | 957.98 | 109.8 | 2.8 | 0.8 |
| Goods | 468.16 | 108.6 | 5.4 | 0.3 |
| Non-durable consumer goods | 297.54 | 111.3 | 6.3 | 0.6 |
| Energy | 103.83 | 108.3 | 11.6 | 1.3 |
| Services | 531.84 | 111.3 | 2.2 | 1.5 |
More information on consumer price statistics is contained in Fachserie 17, Reihe 7 "Verbraucherpreise für Deutschland". Detailed data of consumer price statistics can be found in the tables on the consumer price index (61111-0004) and (61111-0006) and on the harmonised index of consumer prices (61121-0002) and (61121-0004) in the GENESIS-Online database.
