Companies in Germany are increasingly intending to pass on the increased energy costs to their customers. The Ifo price expectations barometer rose to 22.7 points in September from 21.4 in August, the Munich institute reported on Wednesday following a survey. This indicates that higher energy costs are increasingly being reflected in sales prices.
"Gasoline and heating oil have already become significantly more expensive, and energy companies are likely to raise electricity and gas prices in the winter," said Ifo's head of economic forecasting, Timo Wollmershäuser. At the same time, price pressure on many goods and services will continue to rise. "Overall, inflation will rise above three percent in the coming months," he added.
Record prices for diesel and gasoline likely pushed inflation in Germany above the 3% mark for the first time in nearly three years in September. According to economists surveyed by Reuters, consumer prices are expected to rise by an average of 3.1% year-on-year. The last time the figure was above this mark was at the end of 2023, and in August, inflation was at 2.9%. The Federal Statistical Office plans to publish the first estimate on Wednesday afternoon.
The external energy shock led to oil prices temporarily exceeding $100 per barrel. This affected German motorists: according to the ADAC automobile club, diesel and gasoline prices repeatedly reached record levels in September. Prices for natural gas and electricity also reached a peak since the end of 2022 in mid-September, Ifo reported.
In September, price expectations rose in most sectors of the economy. The increase was particularly noticeable in energy-intensive industries, where the indicator rose to 24.8 points from 19.5 in August. In trade, price expectations increased from 30.0 to 35.6 points. In the service sector, on the other hand, companies are less frequently planning price increases – the indicator fell from 20.9 to 19.8 points.
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