Government wants to re-measure inflation

Sharply rising prices: Apartments in Germany rose by an average of 7.8 percent over the year.
Image: dpa

The inflation rate is negative – also because rising house prices are not taken into account. This could change soon.

D.he federal government is fueling efforts in Europe to measure inflation differently in the future. For the first time, Germany has openly committed to supporting the initiative of the President of the European Central Bank, Christine Lagarde, to review the monetary policy strategy. Last but not least, it is a question of how the “consumptive benefit from owner-occupied property” should be recorded and measured. What sounds like monetary theory for university lectures can have huge practical implications, given that inflation is one of the most important economic indicators. Among other things, the decisions of the central banks are influenced by it.

Now the Ministry of Economic Affairs says: “Germany supports the initiative to include owner-occupied residential property in the harmonized consumer price index calculated for European purposes, even if a uniform methodological implementation across Europe would be a very big challenge.” Ullrich. He had asked the government whether they would propose a new inflation methodology during the German Council Presidency.


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