The annual rate of inflation fell to 2.3% in January from a figure of 2.6% in December, according to the latest figures from the Central Statistics Office today.
The CSO said that consumer prices last month fell 0.8%, compared to a decrease of 0.5% in January of last year.
The annual rate of inflation for goods was 0.3% in January, while the corresponding rate of services was 4.1%.
The most significant monthly changes were a 15% decrease in clothing and footwear, due to the traditional winter sales. Transport costs fell by 1.8% due to decreases in petrol, diesel and air fares, however there were increases in toll charges and rail fares.
Health prices rose by over 3% in the month because of an increase in hospital charges, while there was also increases in electricity prices, refuse collection charges and average mortgage interest repayments.
The EU Harmonised index of consumer prices (HICP) fell by 1% in the month, compared with a decrease of 0.6% in January 2004. The annual rate of inflation as measured by the HICP fell from 2.4% in December to 2.1% in January.
Commenting on the inflation figures Eugene Kiernan of Irish Life Investment Managers said the Central bank should be happy with these numbers and that it is looking for an inflation rate of 2.5% for the whole year.
He said the bank warned that they don't have much 'wriggle room' above that, as several years of inflation above euro averages means we have higher prices today.
Kiernan said the heavy weight sectors continue to lead the price increases with hikes of over 9% in areas such as electricity, local authority service charges and housing.
