Prices: Inflation remains negative – but food is becoming more expensive

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Consumer prices in November were lower than in the previous year for the third time in a row. The inflation rate is expected to be minus 0.3 percent this month, announced the Federal Statistical Office on the basis of preliminary results. Compared to the previous month of October, prices fell even more sharply by an average of minus 0.8 percent.
The official statisticians point out that the inflation rate will also be pushed down in the second half of the year by the reduction in VAT. A tax rate of 16 percent instead of the usual 19 percent has been in effect since July 1 – limited to the end of December – the reduced rate is now five percent instead of seven. This is one of the reasons why the inflation rate fell below zero percent in July, and has been below this mark since then, with the exception of August. For the second half of 2021 – if the regular tax rates then apply again – relatively high inflation is to be expected.
However, the prices developed quite differently: Energy was significantly cheaper, the price level here was 7.7 percent below that of the same month last year. This also resulted in the inflation rate for goods generally falling to minus 1.8 percent. Groceries, on the other hand, rose by 1.4 percent compared to November 2019. The prices for services were also 1.1 percent above the previous year’s level.
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https://www.spiegel.de/wirtschaft/service/preise-inflation-bleibt-negativ-doch-lebensmittel-werden-teurer-a-495d9276-b089-4d96-a543-b8f250204a48

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