Inflation down to 1.2 percent in December; 3.4 percent excluding energy

The CPI also presents the price development on the previous month. Consumer prices in December 2023 were on average at virtually the same level as they were in November 2023.

Price developments of energy (gas, electricity and district heating) has long had a major impact on the course of inflation. The inflation rate excluding energy and motor fuels was 3.4 percent versus 4.2 percent in November.

With the December figure being known, the inflation rate for the entire year can also be calculated. On average, consumer prices were 3.8 percent higher in 2023 than they were in the previous year. The inflation rate excluding energy was 6.5 percent.

Inflation down due to food price developments

Food price developments in particular had a dampening effect on the inflation rate. While food products were 4.1 percent more expensive in December than they were one year previously, this was 6.3 percent in November. The lower price increase mainly resulted from price developments of bread and cereal products, dairy products, vegetables and meat.

Major impact energy prices on inflation

The price developments of energy have had a major impact on inflation for some time now. This is mainly due to the high prices of last year. In the second half of 2022, energy prices in the CPI increased sharply, with a peak in October 2022. Partly because of this, high inflation rates were measured during that period. Energy prices in the CPI are now considerably lower than they were in 2022. Inflation is measured as the change in prices relative to one year previously, which is why it is currently lower.

As of June 2023, CBS uses a new method for measuring and incorporating energy prices in the CPI, which affects the inflation rate. On 30 June, CBS published a background article explaining in more detail what this switch means for the CPI, the inflation rate and the use of the CPI for indexation purposes.

Price developments in the short term

The CPI does not only give insight into the price developments relative to one year previously (inflation) but also to the previous month. Prices for consumers in December 2023 were on average at almost the same level as in November 2023. The average price level did not increase much after April 2023, prices in December are 0.3 percent higher.

On a side note, when comparing with the previous month, seasonal influences must be taken into account. For example, airline tickets are more expensive during holiday months than in months outside the holiday season. Prices are temporarily higher then, but this is not a structural price increase. Due to these seasonal influences, month-on-month developments are often more volatile than year-on-year developments.

Inflation in the euro area up

Since 1996, CBS has published two different inflation rates: one based on the Consumer Price Index (CPI) and one based on the Harmonised Index of Consumer Prices (HICP). According to the European HICP, consumer goods and services in the Netherlands were 1.0 percent more expensive in December than in the same month last year. In November, the inflation rate was 1.4 percent according to the HICP. Inflation in the euro area rose from 2.4 percent in November to 2.9 in December.

Difference between CPI and HICP

In order to facilitate comparison between countries, EU member states calculate a consumer price index according to internationally agreed definitions and methods. The European Central Bank (ECB) uses the HICP to formulate its monetary policies in the euro area. In addition, most countries produce their own national consumer price index.

The main conceptual difference between the CPI and the HICP for the Netherlands is that, unlike the CPI, the HICP does not take into account the costs related to home ownership. In the Dutch CPI, these costs are calculated based on developments in rental property prices. The differences are further explained in the article Differences between consumer price figures.