Germany entered a period of deflation
Statistics for the month of July reported 0.6 percent drop in prices compared with levels a year ago
Germany entered a period of deflation, said the German government. Statistics for the month of July reported 0.6 percent drop in prices compared with levels a year ago.
This AFP forward and noted that the German for the first time in 22 years of deflation here.
Federal Statistical Office announced on Wednesday the figures are based on information collected from a total of six shestnaysette German federal provinces. These data were compared with the reported 0.1 percent increase in prices in June on an annual basis.
The Office stated that the last time the price level of goods and services was lower in March 1987 then the decline was 0.3 percent. In the period April 1986 – April 1987 rate of inflation has fluctuated between zero and minus one percent.
„Then, as now, the cause of deflation is rooted in the sharp decline in fuel prices compared with the previous year – says the Commission’s statistical office. July consumer prices fell by 0.1 percent compared to June.
„Reuters“ cites economy by Goldman Sachs’ Dirk Schumacher, according to whom Germany is still far from deflation. „There is no cause for concern. The fall in prices has boosted consumer confidence and purchasing power, „said Schumacher, as the phenomenon which supports consumption.
For its part, economist by UniCredit Group in Munich Alexander Koch believes that inflation in Germany will be negative values over the next two-three months. The forecast is that the defendant will follow spike in fuel prices, which will increase inflation by 1 percent by the end of the year. „This means that you will not need the ECB to take who knows what steps to combat falling prices, supplemented Koch, forward europe.bg.
On „Blumbarg“ recalls the statement by the President of the European Central Bank Jean-Claude Trichet, who on July 2 announced that it expects this phenomenon at very low or even negative rates of inflation to be short. He is convinced that the measures of the ECB are the economies of the 16 euro countries is of „short-term threat of deflation.
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