More purchasing power for German citizens: This has been ensured by strong wage increases and declining inflation in recent months. Experts expect price pressure to continue to ease.
Real wages in Germany also rose in the third quarter of this year. Employees in Germany benefit from strong salary increases with weaker inflation. This was announced by the Federal Statistical Office.
At 6.3 percent, wage growth in the quarter was higher than the 5.7 percent increase in consumer prices. This resulted in a real wage increase of 0.6 percent compared to the same quarter of the previous year.
Highest Wage increases at low-income earners
There was already a first slight increase in real wages in the second quarter of 2023. According to the statistician, the increased minimum wage and the inflation compensation bonus agreed in many companies also contributed to the development in recent months. This service can be exempt from taxes and duties up to an amount of 3,000 euros.
The strongest nominal wage increases among full-time employees occurred in the fifth with the lowest earnings: they averaged 10.3 percent. Part-time employees also achieved an above-average increase of 7.7 percent in the third quarter compared to the same quarter of the previous year.
Further Decrease in inflation probably
The economic research institute ifo believes that the trend towards falling inflation in Germany is likely to continue. The inflation rate is likely to rise temporarily to around four percent in December, said ifo economics chief Timo Wollmershäuser today. Above all, there is a base effect here. Last year, gas prices fell sharply in the consumer price index because the state covered the costs for the December discount. In the new year, however, the inflation rate will fall below around three percent, according to the researchers.
However, according to an ifo survey, slightly more companies want to increase their prices. The pricing plans index rose to 18 in November from 15.4 points in October. According to the experts, this is primarily due to company-related service providers and wholesalers.
This afternoon the Federal Statistical Office is publishing the consumer price data for November. Experts expected the inflation rate to fall from 3.8 to 3.5 percent. There are already figures for individual federal states.
Import prices as harbingers
Falling import prices also suggest lower inflation rates in the future. The prices for imports to Germany fell again in October. According to the Federal Statistical Office, they fell by an average of 13.0 percent compared to the same month last year.
However, the decline in import prices continues to weaken compared to previous months. In September they fell by 14.3 percent and in August by 16.4 percent. In a month-on-month comparison, i.e. from September to October of this year, prices even rose slightly by 0.3 percent.