Is inflation beginning to ease? - RTE Radio 1
New data has revealed that the rate of inflation is slowing in Ireland, and across the Eurozone more generally.
Daragh Cassidy, Head of Communications at bonkers.ie, appeared on RTE News at One to discuss the state of price rises, corporate profiteering and what the landscape for consumers may look like in the coming months.
Listen to the interview above or look at the main points discussed below.
Main points from the interview:
- Ireland’s HICP (Harmonised Index of Consumer Prices) has fallen to 4.6% in the 12 months to July 2023. Prices rose by 5.3% across the Eurozone in the same period.
- This is a decrease in the rate of price growth compared to the 12 months to June, where the HICP was 4.8% for Ireland and 5.5% for the Eurozone.
- The HICP is a measure of inflation designed to allow cross-country comparisons within the Eurozone.
- The slowdown in inflation does not mean prices are falling, but rather that the rate of price increases is slowing down.
- Daragh warned that due to the end of the fuel excise cut in the coming weeks, prices for petrol and diesel will rise by around 15 cent a litre for petrol and 11 cents for a litre of diesel.
- There may also be an increase in the carbon tax following the Budget later this year, which will impact the cost of fuel and gas.
- Daragh says he is most concerned about the rising cost of food and heating, as these are unavoidable expenses for people. You can read more about how to save money on your food bill in this article.
- With the Ukraine grain deal not being extended, there could be an upward price pressure on food supply chains, which will ultimately impact consumer prices for food.
- Another driver of inflation is potentially profiteering by huge multinationals, who have price setting abilities. Inflation caused by this will not be tamed by increases to interest rates, so the European Central Bank is beginning to take that into account.
- It is highly unlikely that we will see deflation, but rather an ongoing decrease in the rate of price hikes over the coming months.
- Irish gas and electricity prices remain some of, if not the highest in Europe. We may see a 10% to 20% decrease in household energy bills in the coming weeks, but this will still leave prices at an elevated level.
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