Inflation increases from 5.71% to 7.59%

13 comments
  1. Looks like an exponential rise.
    Shall i keep euro bills for heating my house and tapestry like in Weimar republic 😑

  2. Question to economists or economics majors here: What does this mean on the long term? Isn’t high inflation really bad for the economy? Interest rates on loans, spending behaviours, etc etc.

  3. Just want to point out that this is good for people who have lot of debt.

    Your outstanding debt will also reduce with 7.59% (in an purchasing power). If you have an interest rate of 1.59% there is a spread of 6%.

    This large spread of 6% corresponds is in the lenders advantage. If you have a 300k EUR mortgage this corresponds to 18k EUR per year or 1.5k EUR per month in your advantage. For a loan of this amount this is roughly equal to monthly mortgage payouts.

    Not, that salary and the price of your house will increase together with inflation.

    This situation is dramatic to people with limited income who are saving for a house. The target is moving much faster as they can realistically save. Banks want that you can pay for all registration rights and 10% of a house. Together amounts to roughly 20%.

    For a house of 300k EUR this corresponds to 60k of savings. If you save 6k per year you might believe you can get your down payment in 10 years.

    Actually, you situation is much more dire. Next year you will need 64k of different for the same house. At the end of the year you are only 2k closer to your target. You might even need 30 years to save your down payment.

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