Food and fuel push prices 3.2pc above level in 2010
Published 03/06/2011 | 05:00
PRESSURE from rising food and fuel prices will keep inflation elevated this year, economists have warned.
The latest inflation figures from the Central Statistics Office show prices were 3.2pc higher than a year previously.
Now a poll of Irish economists by the Reuters news agency has found that most feel prices will remain high throughout the year.
The median of nine economists polled by Reuters put consumer price rises at 2.7pc this year, up on the 2.2pc forecast in the last poll and more than twice the 1.3pc expected at the start of 2011.
This means economists have doubled their forecasts for 2011 consumer price growth since the start of the year, highlighting growing pressure from rising food and fuel prices.
Alan McQuaid, chief economist at Bloxham Stockbrokers, said: "The upward trend in global commodity prices, if maintained, has the potential to push Ireland's headline inflation rate higher this year than originally expected.
"It now looks like it will be closer to 3pc than our original projection of 1pc at the start of the year, putting yet more pressure on the disposable income of hard-pressed consumers."
Consumers who were hit by falling wages, rising unemployment and harsh cutbacks had been cushioned last year and the year before when prices had been falling. But that trend has now been reversed.