Consumer prices rise by 0.1% in year to November

Inflation rose by 0.1 per cent in the year to November, but fell by 0.3 per cent in the month, according to new figures from the Central Statistics Office.

According to the latest Consumer Price Index (CPI), education costs rose 5 per cent compared to the same month a year earlier while miscellaneous goods and services were up 4 per cent. Other notable increases were recorded for alcohol and tobacco and restaurants, and hotel costs, which rose by 3.7 per cent and 1.6 per cent respectively.

Clothing and footwear prices fell by 3.2 per cent over the same period and there were also noticeable decreases in costs of food and non-alcoholic beverages, down 2.6 per cent, furnishings and household equipment, down 2.3 per cent, and transport, down 2 per cent.

Consumer prices fell by 0.3 in November, compared to a 0.2 per cent decrease recorded in November 2013. The most significant monthly price changes were decreases in transport costs, which fell by 1.7 per cent, housing, water, electricity, gas and other fuels, down 0.5 per cent and restaurants and hotels, also down 0.5 per cent. Clothing and footwear costs rose 1.2 per cent, while miscellaneous goods and services and recreation and culture costs increased by 0.6 per cent and 0.4 per cent respectively.

Prices on average, as measured by the EU Harmonised Index of Consumer Prices (HICP), increased by 0.2 per cent compared with November 2013. The HICP decreased by 0.3 per cent per cent in the month, as against a 0.1 per cent in November of last year.

Alan McQuaid, chief economist with Merrion Capital said the latest figures show inflationary pressures continue to remain fairly weak and are likely to remain so for some time.

“It still looks like disinflation/deflation rather than inflation is the bigger threat to the economy at this juncture, and it is not just in Ireland,” he said.

“Following an average Irish inflation rate of just 0.5 per cent in 2013, we are now forecasting a figure of 0.2 per cent for this year. On the assumption of stronger global activity in 2015, we think Irish inflation will push up next year, but will still be only in the 0.5 per cent to 1 per cent range,” he added.