Consumer prices 1.4 percent up in 2017

09/01/2018 15:00
Statistics Netherlands (CBS) reports that the consumer price index rose by 1.4 percent on average in 2017 on the previous year. Goods became 1.5 percent more expensive and the price of services went up by 1.2 percent on average.

After three years of small price increases, consumer prices rose more sharply again in 2017. In 2016, prices of goods and services were up by 0.3 percent, the lowest increase in almost thirty years.

Motor fuel and electricity prices up

The higher average increase in 2017 was mainly due to rising motor fuel and electricity prices. In 2017, the price of petrol went up by 5.2 percent on 2016. Electricity prices declined by 14.8 percent in 2016 as a result of energy tax cuts. In 2017, energy tax rates went up again and therefore electricity prices increased by 1.1 percent.

Food prices rose by 2.7 percent on average, the strongest price increase since 2009. In 2016, prices of food were up by 0.8 percent. Furthermore, prices of package holidays abroad and Dutch holiday park accommodations rose more sharply in 2017 than in 2016.

CAO wages rose faster than consumer prices

Collectively agreed (CAO) wages rose faster than consumer prices for the third year in a row. Wages increased by 1.5 percent in 2017 versus 1.8 percent in 2016. There was less difference between the increase rates of consumer prices and wages in 2017 than in the two preceding years.

Rise in Dutch consumer prices slightly under eurozone rate

Aside from the Dutch consumer price index (CPI), CBS also publishes the European harmonised index of consumer prices (HICP).

HICP-based prices increased by 1.3 percent on average in 2017. The increase across the eurozone amounted to 1.5 percent. Both in the Netherlands and in the eurozone, the price evolution was significantly higher than during the preceding three years.

The HICP is compiled according to the European harmonised method in order to facilitate comparison between the various EU member states. Price indices for the eurozone and the European Union as a whole are calculated on the basis of the HICPs of the individual member states. The European Central Bank (ECB) uses these figures 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.

Sources

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