Deflation accelerated again in May
Thursday, 11 June 2009
Prices for consumers fell by 0.5% last month partly driven by a 0.25% cut in interest rates by the European Central Bank.
The Central Statistics Office said prices had fallen by 4.7% in the 12 months to May.
Prices are dropping as the economy continues to adjust to the rapid changes which are happening in Ireland.
A big factor has been a series of interest rate cuts by the ECB, with mortgage interest down a massive 42% over the past year. In that time rents have fallen 16% and they dropped another 3% last month.
The price of computers has fallen 23% over the past year and car prices have dropped 5.5%
However, rising oil prices are being felt on the forecourts. Petrol rose 3.3% last month and diesel climbed 0.9%.
Many of the changes revealed today show businesses are cutting prices and that some sectors of the economy are becoming more competitive after the boom.
Consumer prices compared to other countries using the euro have returned to levels last seen six years ago.
- Six One News: David Murphy, Business Editor reports that rising unemployment may be why people have less to spend
- Nine News: David Murphy, Business Editor, reports that over the past 12 months food prices are down 2.5%
- One News: David Murphy, Business Editor, reports that mortgage interest has fallen by 42% over the past 12 months
- News At One: David Murphy, Business Editor, reports prices for consumers fell again last month
