Vol. 396 No. 5
57 Mr. Flood asked the Minister for Finance the annual rate of inflation for each of the years from 1983 to 1989, inclusive; the action he is taking to reduce the current rate of inflation; and if he will make a statement on the matter.
The average increase in the consumer price index (CPI) in each of these years was as follows: 1983, 10.4 per cent; 1984, 8.6 per cent; 1985, 5.4 per cent; 1986, 3.9 per cent; 1987, 3.2 per cent; 1988, 2.1 per cent; 1989, 4.0 per cent. The statistics show that, over the past three years, the rate of inflation averaged only a shade above 3 per cent. This was a marked improvement on price trends in preceding years. Slower domestic inflation, in terms of costs as well as prices, was a key factor in the economic recovery, and, in particular, in the real increase in consumer spending. Though there was a pick-up in the price trend through last year, this essentially related to external and temporary influences. All the indications are that the increase in the consumer price index has peaked, and that it will abate progressively through this year.
As indicated in Economic Background to the Budget, the outlook for 1990 is for a continuation of the low inflation pattern of the past few years. The average increase in consumer prices this year should be little more than 3 per cent, with the rate falling below 2½ per cent by end of the year.
