Expert now has a terrible forecast for Austria – economy
Electricity prices in Austria continue to skyrocket – but according to experts, the price increases are not over yet. On the contrary!
According to Statistics Austria, the inflation rate for June 2022 was 8.7 percent – in May it was 7.7 percent! “Renewed price hikes for fuel, food, household energy and in the catering trade have once again significantly boosted inflation in Austria. At + 8.7 percent, consumer prices in June 2022 reached the highest rate of inflation in 47 years. We have such a high rate of inflation in Austria last seen in September 1975,” explains Statistics Austria Director General Tobias Thomas.
The price increase for weekly shopping was also particularly emotional: the price level of the mini-shopping basket, which includes fuel in addition to food and services, rose by 18.8 percent year-on-year. High inflation drives up costs in almost all areas of daily life – including electricity. For more and more people in Austria, the sharply rising electricity bills are becoming a financial burden. And experts are already warning of further price increases – at the end of the year!
The phones at the Association for Consumer Information have been running hot for some time. Clients report massive price increases and electricity providers who terminate contracts and then offer much more expensive new contracts, reports the “Zeit im Bild 2” on Sunday. The VKI examines the cases and also files a lawsuit if the electricity provider’s actions are not legal.
“Some raises questionable”
“Some increases are questionable in terms of amount or the way in which these increases are to be made,” explains Thomas Hirmke from the Association for Consumer Information in a contribution to ZIB2.
In any case, the energy suppliers would defend the increases and explain that wholesale prices should be used as a basis – and these are created on the stock exchange. Within just one year, this has risen by an unbelievable 250 percent, reports ZIB2. And that is exactly what would make electricity so expensive for consumers. And apparently there is no end in sight.
“Second wave of inflation”
Josef Baumgartner from the Economic Institute made the following statement in the “Zeit im Bild 2” sit up and take notice: “We expect a second wave of price increases for gas and electricity, which should start at the end of the year and will take place above all in the first quarter of next year, when the contracts , which were completed in January, February, March this year, then experience the next adjustment.”
The current interest rate increase by the European Central Bank to 0.5 percent will in any case not change anything about the current high interest rate, according to the expert. According to the ZIB2 report, it would usually take up to a year for interest rates to take effect at this level.