Irish inflation rises to 0.6% as restaurant prices increase
Irish inflation has risen to a six-month high of 0.6 per cent on foot of higher prices in restaurants and hotels as well as increased transport and housing costs.
The latest consumer price numbers from the Central Statistics Office (CSO) show overall inflationary pressure in the Irish economy, however, remains fairly subdued.
The main monthly changes affecting the CSO’s Consumer Price Index in October were decreases in the cost of hotel accommodation and air fares.
Electricity charges, rents and the cost of home-heating oil were also higher on a monthly basis. On an annual basis, housing, water, electricity, gas and other fuel prices rose by 3.1 per cent in October, while prices in restaurants and hotels were up 2.7 per cent.
Education costs also rose by 1.8 per cent while prices for alcohol and tobacco rose 1.2 per cent. However, prices for clothing and footwear dropped 4.7 per cent on an annual basis, while furnishings and household equipment prices were down 3.6 per cent.
“Despite strong Irish economic growth, there is little sign of sustained pressure on the prices front, which appears to be the same story across the euro zone, suggesting that the European Central Bank will be in no hurry to tighten monetary policy,” Merrion economist Alan McQuaid said. “Although the annual inflation rate should pick up in the coming months, inflationary pressures in Ireland, as measured by the headline consumer price index, are in general likely to stay reasonably well-contained for the immediate future,” he said.
“Oil prices will be critical in determining the headline inflation outlook over the next 12 months or so, but they remain volatile and hard to predict given the uncertainty over Opec supply and geopolitical tensions in the Middle East,” he said.