Money Guide Ireland

The annual rate of Irish inflation in March 2009 fell 2.6 per cent. This is according to data released by the Central Statistics Office (CSO) today.

Prices showed no change between February and March 2009 compared to an increase of 0.9 per cent in March 2008.

This brought the annual rate of inflation to minus  -2.6 per cent compared with  minus -1.7 per cent in February. The rate of consumer price inflation in Ireland  first turned negative in January 2009 .

In his Budget speech on Tuesday  Brian Lenihan said the Government was expecting inflation to average at  minus 4 per cent this year.

The latest consumer price index from the Irish Central Statistics Office reveal the annual rate of inflation has increased to 5% during March from 4.8% during February.

Higher prices for transportation fuel as well as increases in air fares, mortgage repayments, and home heating oil were the main factors behind the increase.
Two months ago Ireland’s inflation rate was down to 4.3% and most forecasters predicted it would ease considerably further throughout the year.

What has happened since then is that food and energy prices have risen globally and a significant knock on effect on consumer prices has been unavoidable.

Latest figures show that overall the cost of housing electricity and other fuels has risen by 12.3% in a year, while the overall cost of food and non-alcoholic beverages is up by 9.3%.

The cost of bread is up 20% in a year, flour is up 42%, milk is up 31%, mortgage repayments are up 22%, while petrol and diesel are up 12% and 17% respectively.

Inflation grew at an annual rate of 4.9% in June, down from 5% in May, according to new figures from the Central Statistics Office.

However, when the cost of mortgage repayments are excluded, the harmonised index of consumer prices, the common measure of inflation across Europe, shows prices are running ahead by 2.8%. This is 1% higher than the eurozone average.

June’s inflation figures show that the cost of mortgage interest has risen by 46% since June 2006, while there was also a notable increase in the gas and electricity prices.

The CSO report shows electricity prices are up 12.6% on last year and gas prices have increased by 20.5%.
Doctors’ fees have increased 4.9% since June 2006; dentist services are 3.3% higher and hospital fees are 4.4% ahead.
Health insurance costs have increased by 9.6%.

Transport costs, excluding fuel, are also substantially higher than a year ago. Air fares, perhaps reflecting extra charges for baggage and online check-in, are 2.7% more expensive, rail fares are up 6.7% and bus fares are 2.9% higher. Taxi fares are 12.4% higher.

Hotel accommodation price have risen by 3.6% in the past 12 months, eating in restaurants is 4.4% more expensive and drinking beer and wine in a licensed premises has risen by 4.1% and 4% respectively.

Food prices have risen by 2.5% since last year, though there were some categories of declining prices, including lamb, bacon, cheese and butter.