Inflation rate in Ireland drops again

In what will become the norm over the coming months, official figures today show that the annual rate of inflation fell back to 4% last month from 4.3% in September. The Central Statistics Office said lower petrol and diesel prices and falls in the prices of clothes and footwear were the main factors in the fall. The CSO said the figures did not include rises in excise duties announced in the Budget as they took effect after the figures were calculated.

The main factors contributing to the monthly change were as follows:

• Clothing & footwear, furnishings, household equipment and routine household maintenance decreased due to sales.
• Transport fell due to lower petrol and diesel prices and a decrease in airfares.
• Education rose due to the increases in primary, secondary and third level education.
• Miscellaneous goods & services rose due to an increase in childcare costs and higher house insurance premiums.

HICP inflation – the euro area standardised measure – was 2.7% year-on-year (note that it does not include a mortgage component). Inflation would actually be lower were it not for the Budget and the wage-price spiral in the public sector.