Inflation at three year low
INFLATION remains at low levels as the cost of living has been virtually unchanged in the past 12 months.
The latest inflation figures show that hikes in the price of alcohol, cigarettes and education were cancelled out by falls in clothes, furniture and transport costs.
Inflation rose by 0.1pc in August and is up just 0.2pc in the past 12 months, new Central Statistics Office figures show.
The most notable increase was a 5.4pc rise for alcohol and tobacco.
Education costs rose by 4.8pc in the year due to higher third level charges.
Restaurant and bar meanwhile prices rose by 2.2pc mainly due to higher alcohol prices.
The cost of food and beverages meanwhile rose by 1.1 in the last year.
However some staples saw much bigger increases, with the price of bread soaring by 11.3pc and milk rising by 4.2pc.
Potato prices are up over 9pc in the year, while crisps, chocolate and processed fish prices also rose.
There was some relief for motorists as petrol prices are down 3.3pc in the year and diesel is down 4.3pc while overall energy prices are down 0.7pc.
Davy stockbrokers analyst Conall MacCoille said that inflation was at a three-year low reflecting lower energy and mortgage interest costs.
But he noted that the price of services rose by 2.3pc in the year which was indicative of a gradually growing economy.
Merrion economist Alan McQuaid said that weak consumer demand and austerity measures such as the property tax would continue to weigh negatively on spending power and put downward pressure on prices in coming months.