German producer price index rose more than expected in June

According to the report from the Federal Statistical Office, in June 2021, the index of producer prices for industrial products increased by 8.5% compared with June 2020. This was the highest increase compared to the corresponding month of the preceding year since January 1982 (+8.9%), when prices rose strongly during the second oil crisis. Economists had expected a 8.4% increase. Compared with the preceding month May 2021 the overall index rose by 1.3% in June 2021. Economists had expected a 1.1% increase.

Prices of intermediate goods increased by 12.7% compared to June 2020. Compared to May 2021 these prices were up 1.8 %. Compared to June 2020 intermediate goods’ prices increased especially regarding metallic secondary raw materials (+88.1%) and sawn timber (+84.6%) as well as reinforcing steel in bars (+62.3%). 

Energy prices as a whole increased by 16.9% compared to June 2020 and by 2.2 compared to May 2021. The price increase from June 2020 to June 2021 is mainly caused by a base effect resulting from the sharp drop in prices in spring 2020 in the course of the pandemic.

Prices of durable consumer goods increased by 1.8% compared to June 2020 (+0.2% compared to May 2021), capital goods, such as machines and vehicles, by 1.3% (+0.2% compared to May 2021).

Prices of non-durable consumer goods increased by 1.5% compared to June 2020 and rose by 0.7% compared to May 2021. From June 2020 to June 2021 food prices increased by 1.9%.