German Inflation Climbs to Highest Since 2008 on Energy Costs

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German inflation jumped to its highest level since 2008, driven by energy and higher costs passed on by businesses.

Consumer prices rose 3.4% in August, significantly faster than the 2% the European Central Bank aims to achieve sustainably for the euro area. Earlier on Monday, Spain reported a rate of 3.3%. 

So far, policy makers have argued that the current inflation surge is temporary and largely reflects one-off effects. Yet an aggravating supply squeeze is prompting more and more firms to raise charges, a trend that could produce more permanent price pressures.

Inflation imported into Germany is running at 15%, the fastest in four decades, putting a price tag on the difficulties businesses are facing to secure inputs. Selling-price expectations rose to a record in industry, retail trade and construction in the euro area, according to a survey.

Data on the latest trend for consumer prices in the 19-nation region are due on Tuesday.

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