EXPLAINED: The grocery products in Germany getting more expensive

Everyone is talking about consumer prices rising in Germany. What does it mean in real life?

A customer with a €5 note. Products are getting pricier in Germany.
Austria's progressive tax system could be in for a shake up. Photo: picture alliance/dpa | Moritz Frankenberg

Inflation keeps going up – and on Wednesday the Munich-based ifo institute, said it expected consumer prices to rise from 5.1 to 6.1 percent in March – which would be the steepest rise in consumer prices since 1982.

It comes as residents have already been feeling the pinch at the checkout (and on energy bills) over the last few months with the cost of living spiralling upwards. And Russia’s war on Ukraine is exacerbating the issue further. 

READ ALSO: German consumer prices set to rise steeply amid war in Ukraine

According to research by German site Focus Online and trade publications like the Lebensmittel Zeitung, several supermarkets are reacting by pushing prices up further. 

Experts say that Aldi and Lidl tend to set the tone in German supermarkets because they are among the most important customers for the likes of farmers, manufacturers and distributors. 

Last week, Aldi Süd and Aldi Nord increased the price of about 140 items in their standard assortment. Adding flavours, sizes and other variations of these items, the number quickly climbs to 400 products.

A spokesperson for Aldi Nord and Aldi Süd said the market had been strained for months by challenges including the Omicron wave of Covid-19, the international shortage of truck drivers and the increased costs for energy and raw materials.


“The situation has been exacerbated by the war in Ukraine,” said the spokesman. As part of the discounter model, Aldi reduces sales prices when purchase prices fall and increases sales prices when purchase prices rise.

“We would like to point out that our margins do not change as a result of this move,” said the spokesman. 

According to Focus Online, discounter giant Lidl also recently raised the prices of branded products, while there have also been noticeable increases at Rewe and Edeka.

Which products are you paying more for?

According to Focus, the prices of several food and drugstore items have massively increased since the end of January 2022.

Some of the price hikes on products include:

Pasta (up to 40 percent increase)

A supermarket employee in Offenburg stocks pasta in 2020. Pasta has been increasing in price in Germany.

A supermarket employee in Offenburg stocks pasta in 2020. Pasta has been increasing in price in Germany. Photo: picture alliance/dpa | Patrick Seeger

Detergents (up to 20 percent)

Mineral water (over 10 percent)

Dairy products (up to 5 percent)

Coffee (up to 10 percent)

Paper handkerchiefs (up to 15 percent)

Toilet paper (up to 10 percent)

Kitchen roll (up to 20 percent)

Sunflower oil (up to 100 per cent)

READ ALSO: Germans urged not to panic-buy over shortage fears

In most cases, prices per product increased between five and 50 cents.

One example is mixed bio mince from Aldi Süd. While the 400-gram tray cost €3.59 in January, customers now pay €3.99 for it. At Rewe, customers now pay around €5.59 for mixed organic mince instead of €4.99 (January 2022).

The mineral water from own-brand Quellbrunn no longer costs 19 cents at Aldi, but a hefty 25 cents. Rewe seems to have followed suit. Those who put the mineral water from their label “Ja” in their shopping trolley now pay 25 cents for the 1.5-litre bottle at the checkout.

Meanwhile, price hikes for sunflower oil and rapeseed oil are particularly steep.

While last year customers paid between 89 and 99 cents for a bottle of oil, the product now costs up to €1.99 from some retailers. This is of course down to production and harvest stagnating because Russia is waging a brutal war against Ukraine.

A purchasing manager of a well-known discounter told Focus Online: “It’s possible that customers will soon have to pay over three euros for a bottle of sunflower oil.”

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Why German bank customers could soon pay less for their account

A major German bank is set to scrap fees on large balances - and a number of others look set to follow. Here's why people in Germany may be paying less for their savings or current account in the near future.

Why German bank customers could soon pay less for their account

What’s going on? 

Interest rates have been at rock-bottom levels for years, making it much harder for people to get returns on their savings.

In recent years, many banks have even been levying what’s known as negative interest rates on customers. If interest normally incentivises people to save by helping them to grow their money, negative interest basically does the opposite.

If you have a certain amount of money in the bank, your bank will charge you negative interest via a deposit holding fee, which will usually be a certain percentage of your balance.

With N26, for example, balances of over €50,000 are subject to a 0.5 percent fee each year. For a balance of exactly €50,000, that equates to €250 in bank charges just for keeping your money there. 

Some banks even charge a deposit holding fee for balances as low as €5,000 or €10,000 in a current account. 

On Tuesday, ING Deutschland became the first bank to announce that it would be scrapping negative interest rates for the vast majority of its customers.

From July 1st, new customers of ING will be able to deposit up to €500,000 in their account without being charged for it, while existing customers will automatically have the fee-free amount raised to €500,000 from the current €50,000. 

Now, it seems a number of other German banks are planning similar moves. 

Why is ING Deutschland ending the holding fee?

Not entirely out of the goodness of its own heart – though that doesn’t stop it being good news for customers.

The European Central Bank (ECB) is set to make a decision on interest rates in the bloc this July, and most people expect that the bank is poised to increase interest rates from minus 0.5 percent to zero. 

Since banks have basically been passing on the ECB’s fees to their own customers, a hike in the ECB’s interest rate would spell the end of most negative interest-rate accounts in any case. But ING Deutschland said it wanted to pass on the positive interest rate trend to its customers even earlier.

READ ALSO: EXPLAINED: How to save money on your taxes in Germany

“With the increase in the fee-free allowance for credit balances on the current and extra accounts, the deposit fee is no longer applicable for 99.9 percent of our customers,” said Nick Jue, chief executive officer of ING in Germany. “We were one of the last banks to introduce a deposit holding fee and one of the first to virtually abolish it.”

He added that the bank had already kept its promise to abolish the holding fee for almost all customers before the European Central Bank made its decision.

Does this have anything to do with that court decision on bank charges?

That’s definitely a factor. According to a decision in Germany’s Federal Supreme Court last year, credit institutions have to obtain the consent of their customers when making changes to their fees and conditions.

That means that financial institutions have to ask for consent to current fees retrospectively if they don’t want hoards of people trying to claim their money back.

If a customer doesn’t consent to the fees, the bank will usually close that customer’s account.

Man signs a contract

A man in a suit fills in an official form. Photo: picture alliance/dpa/Pixabay | hnw-Gruppe

According to ING Deutschland, the scrapping of negative interest rates on balances up to €500,000 may help to sway those customers who have not yet agreed to the latest terms and conditions – including the deposit holding fee.

Anyone who agrees to the Ts&Cs will automatically be given the higher allowance as of July 1st.

“ING Deutschland expects that the increase in the allowances will convince in particular those customers who have not yet agreed to the General Terms and Conditions including the holding fee, and that the bank will thus terminate fewer customers than last planned,” ING said in a press release. 


What other banks are planning to do this?

According to reports in Bild and Bialo, the other banks planning on ending negative interest rates (or raising the threshold for fee-free balances like ING Deutschland has done) include:

  • Deutsche Bank
  • Commerzbank
  • Deutsche Apotheker- und Ärztebank (Apobank)
  • Dortmunder Volksbank
  • Hamburger Sparkasse (Haspa
  • Frankfurter Sparkasse
  • Frankfurter Volksbank
  • Mittelbrandenburgische Sparkasse
  • Nassauische Sparkasse (Naspa)
  • Ostsächsische Sparkasse Dresden
  • Sparda-Bank München
  • Sparda-Bank Südwest
  • Sparda-Bank West
  • Sparkasse Hannover
  • Sparkasse Pforzheim Calw
  • Volksbank Stuttgart

What does this mean for my savings?

There’s good news and bad news.

The good news is that, from July, you’ll no longer have to pay exorbitant charges just to store your money in a safe place – and you won’t be penalised for saving more. The bad news, on the other hand, is that low interest rates aren’t going away anytime soon.

So while you won’t be losing money hand over fist, you won’t be earning much of a return on your savings either.

Banks in Frankfurt

Skyscrapers in the financial district of Frankfurt am Main. Photo: picture alliance/dpa/dpa-Zentralbild | Fernando Gutierrez-Juarez

“If the interest rate environment continues to develop positively, we will also let our customers participate in this development,” said ING Deutschland’s Nick Jue. “However, the low-interest phase will continue for the time being and broadly diversified investments will remain important.”

Getting a securities account where your money is invested is one way to try and grow your savings, as is investing in property.

Of course, people with mortgages and other loans benefit from the low interest rates – which could be why the German property market is currently booming. 

READ ALSO: Five ways Germany’s soaring inflation could affect your life