Statistics Netherlands reports that Dutch inflation according to the consumer price index (CPI) was 1.0 percent in July, just as in June. Higher prices for airline tickets and holiday accommodations pushed inflation up, but house rents and costs related to home ownership had a downward effect on inflation.
House rents increase 2.3 percent
House rents are annually raised in July. In July 2015, house rents were raised by an average of 2.3 percent. In July 2014, the rent increase was much higher (4.4 percent). On an annual basis, the increase in July was much lower than one month previously, which has a downward effect on inflation.
Inflation rate without energy, food, alcohol and tobacco also stable
Because prices of energy and food vary considerably and alcohol and tobacco prices are frequently raised as a result of tax measures, inflation is also surveyed without taking these product groups into account. According to this criterion, the inflation rate in July was 1.6 percent, the same as in the previous month.
Inflation rate far below 2 percent during the past twenty-four months
Inflation according to the consumer price index (CPI) was 1.0 percent in July, i.e. the same as in June. The consumer price index has been far below 2 percent for almost two years.
Inflation calculated according to the European harmonised price index (HICP), which constitutes the basis for the monetary policy of the European Central Bank, rose to 0.8 percent in July, versus 0.5 percent in June.
Dutch inflation above eurozone level
The HICP is calculated according to the European harmonised method to facilitate comparison between the various EU member states. Price index figures for the eurozone and the European Union as a whole are calculated on the basis of the HICPs of the separate member states.
Dutch inflation according to the HICP rose to 0.8 percent in July and remained far above the average rate across the eurozone, where the rate remained stable at 0.2 percent. The HICP rate in the Netherlands was 0.5 percent in June.
Unlike the CPI, the HICP does not take into account the costs related to home ownership. In the Dutch CPI, these costs are calculated on the basis of rent levels. The downward effect of house rents on the HICP is therefore smaller than on the CPI. As a result, the HICP inflation rate increased, but the CPI rate remained stable.