2023-05-16 22:24:13
FIt is a major annoyance for many in Germany: the prices in supermarkets have increased drastically in the past year and a half – after many things had become much more expensive during the pandemic. Now there are first signs of hope. But many have doubts about how resilient this is.
According to their own statements, Germany’s discounters and supermarkets have lowered the first prices. At Aldi, for example, butter costs 58 percent less than in the middle of last year. Noodles were up to 38 percent cheaper, the company said. Lidl advertises that it has reduced prices for more than 700 product groups since the beginning of the year – most recently by 20 percent for pasta.
Is that just advertising – or can you already feel it in the official statistics? After all, the latest inflation figures show on average continued high price increases for food in April compared to the same month last year, i.e. April 2022 – but for the first time in a long time a decline in average food prices compared to the previous month, March 2023: On average, food prices are now falling 0.8 percent back.
Sunflower oil again significantly cheaper
Many are still suspicious. When asked by the FAZ whether the worst was over with food, ECB President Christine Lagarde said she would like to announce that – after all, there has recently been a decline in inflation in this area – but unfortunately further developments are still certain not.
The prices at the wholesale level show a certain glimmer of hope. On average, they fell in April for the first time in a long time compared to the same month last year. Among other things, there was a significant drop in the price of grain, raw tobacco, seeds and animal feed by an impressive 25.2 percent.
ECB chief economist Philip Lane recently indicated in an interview that he sees the calming of prices at the upstream levels of the producers as a good sign that consumer food prices could soon develop somewhat more positively.
And Bundesbank President Joachim Nagel said in an interview that he himself always follows the prices very carefully when shopping at the weekend. In the case of butter in particular, he noticed that after the price increase last year, it had become a little cheaper again. He says: “Overall, the peak of inflation is behind us.”
If you take a closer look at the statistics on food prices, various effects overlap. After the start of the Ukraine war, some goods in the supermarket suddenly became very expensive because the delivery actually had a connection to the country. This was the case, for example, with sunflower oil. At times, the shelves were empty because the supplies did not come and because the news of the lack of supplies tempted people to hoard. During this time, the price had risen extremely. As a result, things that were considered a substitute for sunflower oil, such as other edible fats, also became more expensive. That has meanwhile reversed somewhat. The prices for sunflower and rapeseed oil fell by 8.2 percent compared to March. On an annual basis, however, that was still a price increase of 28.3 percent.
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