Inflation down

• January’s inflation rate at 1.4 percent
• Reduced by half within six months
• Dutch and eurozone rate almost the same

The most recent figures released by Statistics Netherlands show that inflation fell to 1.4 percent in January 2014, the lowest level since June 2010. In December 2013, Dutch consumer prices were still 1.7 percent up from one year previously. Within a period of six months, the inflation rate in the Netherlands has been reduced by more than half.

Inflation increased in January last year as the insurance tax rate was raised. This tax measure had an upward effect on inflation during the entire year 2013, but the effect has worn off by now. Electricity prices had a downward effect on inflation.

The tax on motor vehicles was raised by 7.2 percent in January 2014, which had an upward effect on inflation. The insurance premiums for supplementary health care were raised by an average of 2.8 percent.

Dutch inflation calculated according to the European harmonised method (HICP) fell to 0.8 percent. Eurostat calculated an inflation rate across the eurozone of 0.7 percent in January. Due to various government measures, the rate in the Netherlands had been considerably above the Eurozone rate since October 2012. The effects of most of these measures have worn off by now and the rate in the Netherlands is currently about the same as the average rate across the eurozone.