With three serious crises at the same time – epidemic, war and climate change – the price structure gets mixed up.
(Photo: Bloomberg)
German producer prices rose by 25.9 percent in February compared to the previous year. That was the continuation of a trend that had been noticeable for months – and the highest increase since 1949. It won’t have a full impact on consumer prices, but it will set the trend there too.
The European Central Bank (ECB) is largely powerless in the face of this. Because the increase is largely driven by energy – without this sector, producer prices would only have risen about half as much. The expensive energy also has an indirect impact on the prices of other sectors. And above all: the increase caused by the war is not yet included in the February figure.
The ECB has three bad options:
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