New figures from the Central Statistics Office show that prices were flat in May compared to April, while they rose by 0.4% on an annual basis.

The CSO said that the biggest monthly price changes were seen in the hotels and restaurants sector, while cinema and theatre prices also rose. The CSO also noticed an increase in the cost of personal care products.

Transport costs fell by 0.22% in the month on the back of cheaper airfares, which was partially offset by more expensive petrol and diesel prices. Clothing and footwear costs also eased slightly due to sales in the shops.

On an annual basis, the CSO said that the cost of education rose by 4.5%, while it also noted higher health and motor insurance premiums and the extra costs associated with the local property tax.

Prices in restaurants and hotels rose by 2.2% while drink and tobacco prices increased by 3.4%.

The cost of communications eased by 4.7% in May on an annual basis, while clothing and footwear prices fell by 3.5% due to sales.

Sales also brought down the price of furnishings and household equipment by 3.2%. Food and non-alcoholic beverages fell by 1.9% due to lower prices across a wide range of products such as bread, vegetables, meat and fruit.

Commenting on today's figures, Investec Ireland's economist Philip O'Sullivan said that muted overall inflationary pressures continue to provide respite to Irish consumers. 

However, he said three factors could change this in the near term. These include the recent weakening of the euro, the increase in world oil prices and the ongoing recovery should, in time, lead to upward pressure on prices as some of the slack in the economy reduces.

Merrion economist Alan McQuaid said at this point in time it still looks like disinflation/deflation rather than inflation is the bigger threat to the economy - both in Ireland and the euro zone.

He noted that euro zone inflation currently stands at just 0.5%, and way below the ECB’s target of close to 2.0%. 

"We’ve already seen the central bank announce dramatic policy measures last week to combat low inflation and in its latest monthly bulletin, it said it would act swiftly with more action if needed," Mr Hughes added. 

"Inflationary pressures in general are set to remain well contained in the immediate future, and we see Ireland’s average headline inflation rate being below 1% again in 2014," he said.