Sunday 23 October 2016

Dip in consumer prices as transport and clothing costs fall

Published 10/07/2015 | 02:30

The price of alcohol has increased
The price of alcohol has increased

Consumer prices dropped by a marginal 0.1pc in the year to June, mainly thanks to a fall in clothing, footwear, and transport costs.

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New CSO figures show that food and drink costs also fell, but there was an increase in hotel and restaurant prices.

However, overall consumer prices in June were 0.3pc higher than in May.

The biggest yearly changes were a 3pc fall in clothing and footwear prices; a 2.5pc drop in transport costs; and a 2.2pc fall in the food and non-alcoholic beverages sector.

Over the 12 months the prices for furnishings, household equipment, and routine household maintenance also fell.

But education costs were up by 5pc.

Communications prices rose by 2.1pc; restaurants and hotels were 1.7pc higher; and housing, water, electricity, gas and other fuels rose by 1.5pc.

Within the transport area there was an increase in air, bus, and taxi fares.

On the other hand, petrol and diesel prices were lower - and there was also a reduction in the cost of cars.

Education spending was mainly affected by the extra costs involved in third-level education.

In the food and non-alcoholic beverages sector, there was a reduction in prices for vegetables, bread, cereals, and meat.

And a price reduction in the sales helped bring down the general cost of clothing and footwear.

Prices in restaurants and hotels rose, mainly due to an increase in the cost of hotel accommodation, plus higher prices for alcoholic drinks and food in pubs and restaurants.

The increase in the cost of housing, water, electricity, and gas was primarily due to higher rents and the introduction of water supply and sewage collection charges.

These costs were partially offset by lower mortgage interest repayments and a decrease in the cost of home-heating oil.

Figures show that the cost of motor insurance is one of the few items to have soared.

Car insurance premiums have increased by an average of 16.3pc during the 12-month period, and home insurance is up by 3pc.

This means that a €500 premium a year ago is now €81.50 more expensive.

Brian McNelis of the Irish Brokers Association warned drivers to expect further premium rises throughout this year.

Premiums were rising and were due to keep rising, because insurers had under-priced for the last few years, and failed to put sufficient reserves in place, he added.

Irish Independent

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