High petrol prices avoid significant inflation drop
Soaring flat rent rates and car fuel prices have kept the Austrian inflation level from declining more significantly year on year than by just 0.2 per cent, new research has shown.State agency Statistik Austria announced today (Weds) the inflation rate was 1.9 per cent last month, down by 0.2 per cent compared to August 2009 and equivalent to July 2010.The body said living costs and car traffic expenses soared year on year. Prices in its “living, water and energy” sector rose by 2.6 per cent year on year, while “traffic” rates including fuel costs and repair price rates jumped by two per cent. Car petrol prices rose by nine per cent, it stressed.These findings are set to rekindle public debate over Austrian mineral oil firms price policy.The Federal Austrian Competition Authority (BWB) said last month that domestic oil companies did not consider global price levels when it came to establishing the prices of diesel and regular fuel at petrol stations.BWB said it had evidence Austrian car fuel price developments “have developed more and more independently from what happened on the Rotterdam products exchange.”Motorists associations have accused petrol station-managing companies for years of upping prices shortly before long weekends and holidays.Traffic Club Austria (VCÖ), an independent pressure group for more eco-friendly individual traffic, however, said the government should raise mineral oil taxes next year, claiming that the Austrian taxation rate on regular petrol and diesel fuel was simply too low by international comparison.One litre of regular car petrol is currently burdened with 44.2 Eurocents in taxes. Tens of thousands of residents of bordering countries come to Austria each year just to fuel their vehicles since their governments issue significantly higher taxes on petrol.Meanwhile, Statistik Austria said flat rent rates jumped by four per cent year on year last month, while housing costs expenses for energy and repairs rose by 2.7 per cent.Average prices for shoes and clothes up by 4.3 per cent also kept inflation from declining stronger than by just 0.2 per cent year on year.Reinhard Backhausen, head of the Austrian Industrial Association for Textiles, Clothes, Shoes and Leather (TBSL), warned only yesterday that customers must be prepared for higher clothes prices due to a sharp rise in cotton trade rates.Backhausen described the current situation as “worrying”.Inflation in the Eurozone the 16 European Union (EU) states which have adopted the Euro as their sole currency edged down from 1.7 per cent in July 2010 to 1.6 per cent the following month.The EU-wide average inflation rate, meanwhile, declined from 2.1 per cent this July to two per cent in August.