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Ireland's inflation rate reaches highest level in 38 years

Ireland's inflation rate reached 7.8% in May, the highest level in 38 years, showed statistics released by the Central Statistics Office today.

The Consumer Price Index last reached this level when annual inflation stood at 7.9% in Q3 1984.

The rising inflation rate comes as consumers struggle to deal with the increasing cost of living.

Price pressures are continuing to build for consumers amid a global supply chain crisis and rising energy prices.

The most significant increases in the year to May 2022 were seen in housing, water, electricity, gas and other fuels which was up 20.9%, and transport which had an annual inflation rate of 16.5%. 

Energy prices have risen sharply for consumers as energy companies continue to increase their prices. The annual inflation rate for electricity and gas reached 40.9% and 57.1% respectively. 

Meanwhile, liquid fuels/home heating oil reached an inflation rate of 102.5% and solid fuels saw an annual inflation rate of 25.9%.

The annual change in transport costs reflects an increase in the cost of diesel and petrol which rose 41.6% and petrol 25.9% respectively. While the purchase of motor cars has increased by 13.2% and airfares have risen by 45.4% compared to the same period last year.

The only areas to show a decrease in prices compared to May 2021 were miscellaneous goods and Services as well as education which experienced a decline of 1.8% and 0.8% respectively.

Colin Cotter, Statistician in the Prices Division, CSO said: “The latest publication for the Consumer Price Index (CPI) shows that prices for consumer goods and services in May 2022 increased by 7.8% on average compared to May 2021. This follows an increase of 7.0% in the year to April 2022. Prices have been rising on an annual basis since April 2021, with an annual inflation of 5.0% or more recorded each month since October 2021. 

Commenting further, Colin Cotter, added: “National Average Prices for selected CPI goods and services for April 2022 were also made available today by the CSO and show that diesel at €1.89 per litre and petrol at €1.81 per litre were up by 54.1 cent per litre (+40.1%) and 34.9 cent per litre (+23.9%) respectively between April 2021 and April 2022.

Figures from the CSO showed that the national average price for bread (large (800g) white sliced pan) increased by 12.4 cent in the year to April 2022, while the same size brown sliced pan had an annual increase of 17.4 cent.

Prices changes for other staple items included a 19.3 cent average increase in a 500g pack of spaghetti while the price for 2.5kg of potatoes fell by 28.5 cent on average.

The national average price of a take-home 50cl can of lager had an average increase of 27.9 cent at €2.16 from April 2021, while a take-home 50cl can of cider at €2.36 increased by 14.1 cent.