Irish Economy 2013: Annual consumer price inflation 0.3% higher in November
compared with November 2012, according to the CSO today.
The most notable changes in the year were increases in Alcoholic Beverages &
Tobacco (+6.2%), Education (+4.5%) and Restaurants & Hotels (+3.1%). There were
decreases in Clothing & Footwear (-4.6%), Furnishings, Household Equipment &
Routine Household Maintenance (-4.2%), Communications (-3.1%) and Transport
Consumer prices in November fell by 0.2% in the
month. This compares to a decrease of 0.4% recorded in November of last year.
The most significant monthly price changes were decreases in Transport (-1.4%)
and Health (-0.8%). There were increases in Restaurants & Hotels (+0.6%) and
Alcoholic Beverages & Tobacco (+0.4%).
The main factors contributing to the annual change were as follows:
- Restaurants & Hotels increased due to higher
prices for alcohol consumed on licensed premises;
- Alcoholic Beverages & Tobacco rose due to
higher prices for alcohol sold in off licences and supermarkets and higher
- Miscellaneous Goods & Services increased
mainly due to higher health insurance premiums;
- Education rose due to an increase in third
level education costs;
- Transport fell due to decreases in petrol
and diesel and motor car prices;
- Clothing & Footwear fell due to clothing and footwear sales.
The annual rate of inflation for Services was 2.2% in the year to November,
while Goods decreased by 1.9%. Services, excluding mortgage interest repayments,
increased by 3.0% in the year since November 2012.
The CPI excluding tobacco for November decreased by 0.2% in the month and rose
by 0.2% in the year. The CPI excluding energy products remained unchanged in the
month and increased by 0.7% in the year. The CPI excluding mortgage interest
decreased by 0.1% in the month and was up by 0.7% in the year.
Harmonised Index of Consumer Prices:
Prices on average, as measured by the EU's HICP, increased by 0.3% compared with
November 2012. The most notable changes in the year were increases in Alcoholic
Beverages & Tobacco (+6.1%), Education (+4.5%), Housing, Water, Electricity, Gas
& Other Fuels (+3.6%) and Restaurants & Hotels (+3.0%). There were decreases in
Clothing & Footwear (-4.5%), Furnishings, Household Equipment & Routine
Household Maintenance (-4.2%), Communications (-3.1%) and Transport (-2.8%).
The EU Harmonised Index of Consumer Prices (HICP)
fell 0.1% in the
month, compared to a decrease of 0.5% in November of last year.
David McNamara, economist at Davy,
commented: "Mortgage interest costs, linked to the ECB rate, were down 6% in the
year to September, while energy prices, linked to movements in oil prices, were
down 2.8%. In contrast, domestically-driven services price inflation (excluding
mortgage interest) was up 3% year-on-year, pointing to healthy growth in the
domestic economy. Goods price inflation was down 1.9%, again driven by waning
external price pressures on imports into the country.
The sub-sectors exerting upward pressure on the index over the year were Alcohol
and Tobacco (+6.2%), Education (+4.5%) and Restaurants & Hotels (+3.1%). While
these rises were largely offset by energy and mortgage interest, other sectors
contributing to the weak headline number were Clothing & Footwear (-4.6%),
Household Equipment & Maintenance (-4.2%) and Communications (-3.1%).
The continued weakness of import prices is a welcome boost to households’
spending power in the run-up to the Christmas period and should mean further
expansion in real wages in Q4 if the positive momentum in the labour market is
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