Inflation rises to 6.4% in September

Inflation in the Irish economy rose to 6.4 per cent in September, marking two straight years where monthly reports have recorded annual inflation of at least 5 per cent.

Latest figures from the Central Statistics Office (CSO) show that the Consumer Price Index (CPI) climbed by 6.4 per cent between September 2022 and September 2023, up from an annual increase of 6.3 per cent in the 12 months to August.

Housing, water, electricity and fuel costs saw the largest rise in the year to September, as prices grew by 16.9 per cent.

This was primarily driven by a rise in the cost of mortgage interest repayments, which have jumped by 49.5 per cent in the 12 months to September 2023, as well as rising costs of rents, electricity, gas and solid fuels.

The CSO noted that if mortgage interest is excluded from the CPI, inflation has risen by 5.2 per cent in the year to September 2023. This figure is still slightly above the flash estimate for Irish inflation published at the end of last month.

Based on the EU Harmonised Index of Consumer Prices (HICP), which does not include mortgage interest, flash figures published on 28 September estimated that Irish inflation had risen by 5 per cent in the year to September.

The CPI shows that the cost of recreation and culture also saw a large increase in the year to September, with a rise of 9.4 per cent primarily due to higher prices for package holidays, participation in recreational and sporting services and products for pets.

Education was the only sector to show a decrease when compared with September 2022, with costs falling by 6.3 per cent, mainly due to a reduction in third level costs.

Between August and September 2023, consumer prices rose by 0.1 per cent, down from a 0.7 per cent monthly increase between July and August of this year.

The largest monthly price increases in September were for clothing and footwear, where costs rose by 3.3 per cent due to a recovery from sales.

Housing, electricity and fuel costs rose by 1 per cent in the month to September, primarily due to an increase in the cost of liquid fuels (home heating oil), rents and mortgage interest repayments.

Meanwhile, there was a 3 per cent fall in the cost of recreation and culture between August and September due to lower prices for package holidays, and transport costs fell by 1 per cent due to lower prices for air fares.

National Average Prices in September 2023