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By Ed Frankl
German companies’ expectations for price increases in the coming months have eased further, indicating continued prospects of falling inflation in the country, according to an Ifo Institute business survey.
Ifo’s index for price increases fell to 14.7 points in August from a seasonally adjusted 16.3 in July, it said. The balance is calculated by subtracting the percentage of companies that want to lower their prices from the percentage of those that want to raise them.
“However, the decline in inflation will be a long, hard road,” Timo Wollmershaeuser, head of forecasts at Ifo, said. Among retailers, in the hospitality sector and in the food-and-drinks trade, price expectations fell only slightly, the survey said.
In manufacturing, however, price increases have almost stopped, Wollmershaeuser said, though that hides that car makers on average are still planning to raise prices, while paper manufacturers are looking to cut them.
Meanwhile, services providers are looking to raise prices, albeit at a slower rate, and in construction prices are set to fall by a steeper pace, according to Ifo.
Write to Ed Frankl at [email protected]
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