Official figures show that the annual rate of inflation was 5.1% in April, unchanged from March and close to a near six-year high of 5.2% hit in January.
The Central Statistics Office said prices rose by 0.8% in the month, mainly because of higher mortgage repayments as a result of interest rate increases. Transport costs also rose due to higher prices for petrol, diesel, air fares and bus fares. Other contributors to higher prices were food, restaurants and accommodation.
A breakdown showed that average mortgage repayments jumped by 6% in April compared with March following the ECB rise in March. Air fares were up 4.1%, while petrol prices climbed by 3.4%.
The annual rate of inflation for services was 9.1%, while goods inflation was 0.4%. The annual rate as measured by the EU's harmonised HICP was unchanged at 2.9%.
Bloxham economist Alan McQuaid says inflation will average around 4.5% this year, with most commentators forecasting it to fall to between 2.5% and 3% in 2008, on the assumption the ECB will stop rising interest rates, and oil prices will not go over $70 by the end of 2007.
'However, the problem is that we have no control over what happens to interest rates and/or oil prices, and as such we are very much at the mercy of the gods as regards developments on these fronts', he warned.
Ulster Bank's Pat McArdle said inflation was likely to remain at around 5% for the next few months and average 4.75% this year. But he pointed out that inflation excluding energy and mortgage rates fell to 2.5%, though food prices rose.
