Inflation soars to 20-year high

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By Eoin Glackin

A new report from the Central Statistics Office (CSO) shows the annual rate of inflation, as measured by the Consumer Price Index (CPI), rose to 5.3% higher in November 2021 compared with November 2020. The largest annual change since June 2001 (+5.3%). 

The most notable changes in the year were increases in Transport (+16.2%), Housing, Water, Electricity, Gas & Other Fuels (+12.0%), Restaurants & Hotels (+3.9%) and Alcoholic Beverages & Tobacco (+3.4%). 

A decrease occurred in Miscellaneous Goods & Services (-0.3%).

Consumer Prices in November increased by 0.6% in the month. This is the thirteenth month in a row that has shown monthly inflation. Prices rose by 0.3% in November 2020.

The biggest monthly price increases were in Clothing & Footwear (+3.3%) and Transport (+1.3%). There were decreases in Alcoholic Beverages & Tobacco (-0.7%) and Restaurants & Hotels (-0.1%).

The largest upward contributions to the CPI in the year were Transport (+2.07%), Housing, Water, Electricity, Gas & Other Fuels (+1.92%), Restaurants & Hotels (+0.61%) and Alcoholic Beverages & Tobacco (+0.23%).

The largest downward contribution to the CPI in the year was Miscellaneous Goods & Services (-0.03%).

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

  • Transport increased primarily due to higher prices for diesel, petrol and motor cars, an increase in airfares and a rise in the cost of services in respect of personal transport equipment.
  • Housing, Water, Electricity, Gas & Other Fuels rose mainly due to higher rents and mortgage interest repayments and an increase in the cost of electricity, home heating oil and gas.
  • Restaurants & Hotels increased primarily due to a rise in the cost of hotel accommodation and higher prices for alcoholic drinks and food consumed in licensed premises, restaurants, cafes etc.
  • Alcoholic Beverages & Tobacco rose mainly due to an increase in the cost of tobacco products and higher prices for wine sold in supermarkets and off licences.
  • Miscellaneous Goods & Services decreased primarily due to a fall in the cost of motor insurance premiums and lower prices for jewellery, clocks & watches and articles & products for personal care. This decrease was partially offset by higher health insurance premiums.

The sub index for Services rose by 5.3% in the year to November, while Goods increased by 5.0%. Services, excluding mortgage interest repayments, increased by 5.4% in the year since November 2020.

The CPI excluding tobacco increased by 0.6% in the month of November and rose by 5.3% in the year. The CPI excluding mortgage interest increased by 0.6% in the month and rose by 5.3% in the year.

Prices on average, as measured by the EU Harmonised Index of Consumer Prices (HICP), increased by 5.4% compared with November 2020.

The most notable changes in the year were increases in Transport (+17.1%), Housing, Water, Electricity, Gas & Other Fuels (+14.3%), Restaurants & Hotels (+3.9%) and Alcoholic Beverages & Tobacco (+3.4%). There was a decrease in Miscellaneous Goods & Services (-0.9%).

The HICP increased by 0.6% in the month. This compares to an increase of 0.3% recorded in November of last year.

The most significant monthly price changes were increases in Clothing & Footwear (+3.3%) and Housing, Water, Electricity, Gas & Other Fuels (+1.5%). There were decreases in Alcoholic Beverages & Tobacco (-0.8%) and Restaurants & Hotels (-0.2%).

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