Irish inflation falls to 4.1% in January - CSO

Irish consumer prices were on average 4.1 per cent higher in January than the same month last year, as the annual inflation rate eased from 4.6 per cent in December, the Central Statistics Office (CSO) said on Thursday.

In its latest consumer price index (CPI) release, the CSO said January was just the third month since September 2021 in which prices increased by less than 5 per cent on an annual basis. It was also the third consecutive month in which the annual rate of inflation was below 5 per cent.

Electricity, gas and other fuel prices – one of the main drivers of the current bout of consumer price inflation across the EU – declined 12.9 per cent over the 12 months, the CSO said. However, excluding volatile energy and food prices, the index rose by 5.3 per cent year-on-year in January.

The category of goods with the steepest increase - 9.3 per cent over the 12 months - was recreation and culture. This was due to higher prices for package holidays and increased participation in sporting and cultural events.

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The price of admission to sports events increased 7.3 per cent in the year while sports club and society subscription costs climbed 5.3 per cent, the CSO said.

Meanwhile, restaurant and hotel prices continued to soar, rising 7.2 per cent between January 2023 and last month. This was largely due to higher prices for alcoholic drinks and food consumed in licensed premises and restaurants and an increase in the cost of hotel accommodation, which rose 7.6 per cent in the year.

Clothing and footwear was the only category to show an overall decline in prices, falling 1.3 per cent compared with January 2023 due to a fall in sales.

Amid a sharp increase in retail interest rate as banks look to pass on the European Central Bank’s rate hikes to customers, the cost of mortgage repayments continued to gain momentum in January, having risen 31.8 per cent over the 12 months the CSO said. Housing rents, meanwhile, climbed 13.9 per cent overall with local authority rents increasing 7.8 per cent in the year, a faster pace than private rents, which jumped 6 per cent over 12 months.

The latest CPI is the CSO’s first using an updated basket of goods to benchmark prices.

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