Dutch inflation was 1.9 percent in December, substantially down on November’s 2.3 percent. For the fourth month in a row, inflation was substantially lower than in the previous month.
Lower car fuel prices were the main cause for the drop in inflation. In December, car fuel was 17 percent cheaper than one year previously. In November, motor fuel prices were over 12 percent down on the same month in 2007.
Car fuel prices had a downward effect on inflation of 0.6 percentage points, as against 0.4 percentage points in November. With 0.7 percentage points, housing, water and energy costs contributed most substantially to inflation. Food contributed 0.5 percentage points to inflation, tobacco and alcoholic drinks accounted for 0.3 percentage points.
The harmonised consumer price index (HICP) allows comparison between the member states of the European Union (EU). According to the HICP, Dutch inflation was 1.7 percent in December, i.e. 0.2 percentage points down on November. The Netherlands was not the only country where inflation declined. The rate dropped even more rapidly in the eurozone. Eurostat, the European statistical office, calculated an inflation rate in the eurozone of 1.6 percent in December, as against 2.1 percent in November. December 2008 was the first month since May 2007 in which Dutch inflation exceeded the eurozone average.
Inflation is calculated as the increase of the consumer price index (CPI) relative to the same month in the previous year.