Fuel prices soar but inflation rate slows to just 1.2pc
Published 09/11/2012 | 05:00
THE price of potatoes has jumped almost 20pc in the past year, but the cost of mortgage interest fell by a similar amount.
New figures show that despite significant increases in the cost of fuel, education and transport, the rate of inflation slowed in the past year, rising by only 1.2pc in the 12 months to October 2012.
This represents a considerable slowdown, at less than half the 2.8pc increase of the previous year.
An increase in the cost of third-level studies contributed to inflation in the education sector, while the steady climb of fuel prices drove up transport costs.
However, this was largely offset by a fall in prices elsewhere, with communications, furnishings and household maintenance all costing less.
Mortgage interest rates fell, by a significant 18.1pc over the year, but the cost of heating a home rose by nearly 10pc.
The cost of living fell slightly last month, down 0.1pc, according to the Consumer Price Index (CPI), published by the Central Statistics Office. This compares with an increase of 0.3pc in October last year.
A breakdown of the price changes shows the cost of education rose 6.7pc while transport costs rose 5.8pc.
Among the other sectors that saw price rises were tobacco (7pc), petrol (11.5pc), diesel (12.4pc), motor oil (11.1pc) and motor tax (10.8pc). Beer prices, however, have dropped by 3.2pc in the past 12 months.
Food prices were up only slightly, but the price of many goods actually fell. The biggest rise was in the price of potatoes, up 18.8pc, and there were marginal increases in butter, eggs and flour. The price of beef, veal and pork also rose.
However, there were savings in the overall household bill by switching to other foods -- the price of frozen fish fell by more than 10pc, and there were also cuts in the cost of pizza, quiche and cheese.
The Irish Small and Medium Enterprises Association (ISME), urged the Government not to portray yesterday's figures as a positive sign.
"The reality is that Irish businesses continue to be undermined by cost increases in key areas controlled by the State," said chief executive Mark Fielding said. "This is putting pressure on companies that have cut their own costs, forcing a devastating reduction in employment levels."
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