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24 Oct, 2022 11:46

Double-digit inflation hits another EU member

Economists label surging prices in Denmark a “true nightmare for Danish wallets”
Double-digit inflation hits another EU member

Annual inflation in Denmark reached 11.1% in September, the Danish news agency Ritzaus Bureau reported on Monday, citing the national statistics agency.

The latest update by Statistics Denmark and the EU-wide consumer price index show bills for basic goods in Denmark having been 11.1% higher on average last month than in September 2021. This beat the previous high recorded in 1982, when year-on-year inflation stood at 10.1%.

“High inflation is raging everywhere in Europe. 18 countries in Europe are battling two-digit inflation rates. It’s worst in the Baltic region where inflation is over 20% in all three countries,” Allen Sorensen, senior economist at the Confederation of Danish Industry, wrote in a comment.

The August print showed price growth of 9.9%, but rising energy prices across the EU have continued to drive food prices up and push inflation to double digits. According to the report, the Danish annual inflation rate is notably higher than the EU average.

A senior economist at the managers trade union Lederne, Niklas Praefke, believes the current price growth is “the greatest challenge for the Danish economy” and a “true nightmare for Danish wallets.”

The recent figures indicate a significant reduction in wages in real terms and a slashing of the purchasing power of households.

“I did not expect us to see two-digit inflation rates. I thought that belonged to the history books,” Tore Stramer, a senior economist at Realkredit Denmark, told the news agency, adding that activity in the Danish economy is expected to decrease this winter, with private spending further dropping.

The economist has also stressed that the unprecedented inflationary pressure across the bloc is being seen due to “the war in Ukraine and the restrictions the EU and Russia have placed on each other.”

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