German production costs hit 70-year high

German manufacturers hiked their prices by nearly 50% in September year-on-year, following similar increases in recent months, the Federal Statistics Office (Destatis) reported on Thursday.

Producer prices for commercial products rose by 45.8% in September compared to the same month last year, Destatis said. The rate was 2.3% higher than in August, which saw an identical surge of 45.8% year-on-year.

“August and September 2022 were therefore the highest Increases in producer prices compared to a month in the previous year have been measured since the survey began in 1949,” the statistics authority wrote.

Rising energy costs are the main reason for the increase in commercial producer prices, Destatis continued, saying that electricity cost 259.8% more for redistributors than a year earlier.

Producer prices are the prices at the factory gate, and are considered to be the driving force behind general inflation. Germany’s consumer price index stood at 10% year-on-year in September.

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