Inflation rate drops marginally

10/11/2011 15:00

Dutch inflation was 2.6 percent in October, 0.1 percentage points lower than in September. Prices charged for airline tickets and petrol largely accounted for the decline. Inflation is defined as the increase in the consumer price index (CPI) in a particular month compared to the same month in the previous year.

Housing, energy and water (0.7 percentage points) and transport costs (0.5 percentage points) contributed most to October’s inflation rate of 2.6 percent. Food and soft drinks contributed 0.3 percentage points and expenditure abroad 0.2 percentage points. Other goods and services also contributed to inflation, but to a lesser extent.

The harmonised consumer price index (HICP) allows comparison between the inflation rates in the various member states of the European Union (EU). According to the HICP method, the Dutch inflation rate in October was 2.8 percent, i.e. 0.2 percentage points below September’s inflation rate level. Eurostat, the European statistical office, calculated an inflation rate of 3.0 percent in the eurozone over October. This is the same as in September. The level of inflation in the eurozone is one of the main guidelines for the European Central Bank (ECB) to change or refrain from changing the interest rate. According to the ECB, prices in the eurozone are stable, if the inflation rate is close to 2 percent.

In September and October 2011, the interest rate on the latest Dutch ten-year government bonds was below the level of inflation, which is quite an exceptional situation. More information can be found in the article “Interest rate on government bonds lower than inflation”.

Dutch inflation

Dutch inflation

More figures can be found in dossier Business cycle.

For more information on Dutch inflation, see Statistics Netherlands’ online video on YouTube.