Dáil Éireann Debate, Thursday - 23 June 2016
99. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which any inflationary indicators have been detected in the economy which might require correction; and if he will make a statement on the matter. [17763/16]
View answerMy Department continues monitoring a wide range of indicators to assess inflationary pressures in the Irish economy.
Overall, inflation rates continue to be low. The most recent data published by the Central Statistics Office (CSO) on June 9th shows that inflation has been relatively muted over the past year. The the annual rate of inflation, as measured by their harmonized index of consumer prices (HICP) decreased by 0.2 per cent in May 2016 compared to the same month last year. This reflects a low monthly inflation rate, of 0.5 per cent, seasonally adjusted, between April and May 2016.
The low annual rate of inflation in Ireland, at -0.2 per cent, which is in line with that of the euro area, at -0.1 per cent, in the 12 months to May 2016, has been mainly driven by falling energy prices. However, annual HICP core inflation (excluding energy prices and unprocessed food) in Ireland increased slightly to 0.9 per cent in May, which is in line with that of the euro area at 0.8 per cent.
The Stability Programme Update published in April 2016 shows inflation increasing moderately over the year, with HICP inflation of 0.4 per cent forecast for 2016. This is broadly consistent with the rest of the EU.
