Highest increase consumer prices in almost 5 years

Statistics Netherlands (CBS) reports that the consumer price index (CPI) was 2.1 percent higher in July than in the same month last year. In June, prices of consumer goods and services were up by 1.7 percent year-on-year. For the first time after September 2013, the price increase was above 2 percent.

The consumer price index (CPI) is an important indicator for inflation, but not the only one. It is an index for price changes in a basket of consumer goods and services, such as groceries, clothing, petrol, rent and insurance premiums. Inflation is a broader term which covers more than consumer goods and services; for example, prices of owner-occupied houses, manufactured products, shares and gold are also subject to change.

Consumer price index (CPI) (year-on-year % change)
   mutatie
2014J1.4
F1.1
M0.8
A1.2
M0.8
J0.9
J0.9
A1
S0.9
O1.1
N1
D0.7
2015J0
F0.2
M0.4
A0.6
M1.1
J1
J1
A0.8
S0.6
O0.6
N0.7
D0.7
2016J0.6
F0.6
M0.6
A0
M0
J0
J-0.2
A0.2
S0.1
O0.4
N0.6
D1
2017J1.7
F1.8
M1.1
A1.6
M1.1
J1.1
J1.3
A1.4
S1.5
O1.3
N1.5
D1.3
2018J1.5
F1.2
M1
A1.1
M1.7
J1.7
J2.1

Price increase house rents higher

Mainly due to the price development of house rents, the inflation rate was higher than in June. Dutch house rents are annually raised in July. The average residential rent increase was 2.3 percent in July 2018, versus 1.6 percent in July 2017. Price developments of natural gas and electricity also had an upward effect on consumer prices.

CPI: Major contributions to year-on-year change (percentage point)
 June 2018July 2018
Total1.72.1
Housing, water and
energy
0.640.88
Transport0.540.55
Miscellaneous goods
and services
0.180.22
Consumption abroad0.140.19
Restaurants and hotels0.130.15
Recreatie en cultuur0.060.07
Food and non alcoholic
beverages
-0.010.01
Communication-0.16-0.16

Rise in Dutch consumer prices lower than in eurozone

In addition to the consumer price index (CPI), CBS also calculates the European harmonised price index (HICP).

In July, HICP-based prices of goods and services in the Netherlands were 1.9 percent up year-on-year, versus 1.7 percent in June. In the eurozone, the price increase went up from 2.0 to 2.1 percent.

HICP (year-on-year % change)
   The NetherlandsEuro area
2014J0.80.8
F0.40.7
M0.10.5
A0.60.7
M0.10.5
J0.30.5
J0.30.4
A0.40.4
S0.30.3
O0.40.4
N0.30.3
D-0.1-0.2
2015J-0.7-0.6
F-0.5-0.3
M-0.3-0.1
A00
M0.70.3
J0.50.2
J0.80.2
A0.40.1
S0.3-0.1
O0.40.1
N0.40.1
D0.50.2
2016J0.20.3
F0.3-0.2
M0.50
A-0.2-0.2
M-0.2-0.1
J-0.20.1
J-0.60.2
A0.10.2
S-0.10.4
O0.30.5
N0.40.6
D0.71.1
2017J1.61.8
F1.72
M0.61.5
A1.41.9
M0.71.4
J11.3
J1.51.3
A1.51.5
S1.41.5
O1.31.4
N1.51.5
D1.21.4
2018J1.51.3
F1.31.1
M11.3
A11.3
M1.91.9
J1.72
J1.92.1

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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