Annual inflation falls to 2.5% in December
Consumer prices in December, as measured by the CPI, decreased by 0.1% in the month. This compares to an increase of 0.1% in December of last year and, as a result, the annual rate of inflation fell to 2.5%, down from 2.6% in November.
The EU Harmonised Index of Consumer Prices (HICP) fell by 0.2%, compared with an increase of 0.1% in December 2004. The annual rate of inflation, as measured by the HICP, fell from 2.2% in November to 1.9% in December.
The most notable changes in the year were increases in housing, water, electricity, gas and other fuels (+10.8%), health (+5.8%), education (+4.9%), restaurants and hotels (+3.2%) and transport (+3.1%).
There were decreases in clothing and footwear (-1.9%), furnishings, household equipment and routine household maintenance (-1.2%) and food and non-alcoholic beverages (-1.0%).
The annual rate of inflation for goods was 0.5% in December while the corresponding rate for services was 4.2%.
The most significant monthly price changes were decreases in transport (-0.6%), clothing and footwear (-0.5%) and alcoholic beverages and tobacco (-0.3%).
These decreases were partially offset by an increase in housing, water, electricity, gas and other fuels (+0.7%).
The main factors contributing to the monthly change were as follows.
Transport fell with lower prices for petrol and diesel.
Clothing and footwear decreased with lower prices for both clothing and footwear.
Alcoholic beverages and tobacco fell due to lower prices for off-licence spirits and beer.
Housing, water, electricity, gas and other fuels rose with an increase in average mortgage interest repayments, as higher interest rates were brought into effect by a number of lending institutions.
This increase was partially offset by a decrease in home heating oil prices.
The CPI excluding tobacco index for December was 111.9, down 0.1% since November and up 2.5% in the year.
The CPI excluding energy products was up 0.3% since November and increased by 1.8% in the year since December 2004.
