More German Companies Plan to Increase Prices

More German companies are planning to raise their prices than in the previous month, finds the ifo Institute’s latest survey. For the economy as a whole, price expectations for the coming months stood at 53.5 points in September, up from 48.1 (seasonally adjusted) points in August. For food, the indicator stood at a full 100 points, up from 96.9 (seasonally adjusted) points in August. “Unfortunately, this probably means the wave of inflation isn’t about to subside,” says Timo Wollmershäuser, Head of Forecasts at ifo. “Especially when it comes to gas and electricity, the price pipeline is not yet exhausted.” 

In trade, companies that plan to raise their prices are, in particular, sellers of drugstore items (92.3 points), of flowers, plants, and pet products (89.6 points), of toys (89.0 points), of bicycles (84.4 points), and of stationary (83.8 points). 

In manufacturing, the front-runners are manufacturers of clothing (83.5 points), of glass, ceramics, and stoneware (77.3 points), and of electrical equipment (75.5 points), as well as printing companies (70.3 points).

The numbers are also very high in hospitality (87.4 points), in services to buildings (78.0 points), and among hotels (62.4 points). 

The points for the ifo price expectations indicate the percentage of companies that intend to increase prices on balance. The balance is obtained by subtracting the percentage of companies that want to lower their prices from the percentage of those that want to raise their prices. If all the companies surveyed intended to increase their prices, the balance would be plus 100 points. If they all wanted to lower their prices, it would be minus 100. The balance was seasonally adjusted. The ifo Institute does not ask about the amount of the planned price change.