Inflation rate stable in March

13/04/2016 12:30
On a year-on-year basis, the CPI inflation rate in the Netherlands was 0.6 percent in March, the same as in February. According to Statistics Netherlands (CBS), the rate has been fairly stable over the past six months.

Inflation (CPI)
 

Petrol cheaper, airfares have upward effect on inflation

Petrol price developments had a downward effect on inflation in March. The average litre price of unleaded petrol was 18 eurocents down from one year previously. In February the year-on-year price difference was 13 eurocents per litre.

Price developments for airfares, hotels and cottages forced inflation up. Because Easter 2016 was in March, prices of these services increased. Easter 2015 was in April.

Inflation excluding energy, food, alcohol and tobacco remains unchanged

Price developments for energy and food vary strongly and alcohol and tobacco prices are frequently raised as a result of higher excise duty rates. Therefore, inflation is also measured without taking these product groups into account. According to this criterion, the rate in March was the same as in February (1.3 percent).

Inflation (CPI) and price developments underlying clusters

Inflation in the Netherlands still higher than in the eurozone

In addition to the consumer price index (CPI), CBS also compiles the European harmonised price index (HICP). The Dutch HICP inflation rate was 0.5 percent in March, versus 0.3 percent in February. In the past two months the Dutch rate has higher than the eurozone rate. The eurozone inflation rates over March and February were - 0.1 and - 0.2 percent respectively.

Inflation (HICP)

The HICP is calculated in accordance with the European harmonised method, which facilitates comparison between the member states of the European Union. Price indices for the eurozone and the EU as a whole are calculated on the basis of the HICPs of the individual member states. The European Central Bank (ECB) is using these data to formulate its monetary policy.

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. However, because the increase in rental prices is higher than the average price increase of other goods and services, the Dutch inflation rate based on the CPI is currently lower than the rate based on the HICP.