Soaring fuel and rental costs push up the cost of living

Soaring fuel and rental costs push up the cost of living

The cost of heating a home ballooned by 17% in November, compared to the same month last year, while it was 7% more expensive to rent one’s home, new figures from the CSO show.

Fuel, electricity and rental costs drove an overall 0.6% year-on-year rise in consumer prices last month.

On a monthly basis, prices fell by 0.5% and November’s annual inflation rate was down from 0.9% in October.

On an annual basis, electricity and fuel prices rose by over 5% in November. Mortgage interest costs rose by 1.2%. The cost of eating out in restaurants and staying in hotels grew by nearly 2% compared to the same month last year.

Education costs jumped by 1.7% and the price of alcoholic drinks and tobacco products rose by over 3%, largely representing the excise hike seen in October’s budget.

All forms of enjoyment seemed to become more expensive, with near 2% rises in the cost of going to the cinema or a nightclub also noted in the CSO’s latest inflation figures.

Commentators have forecast an average inflation rate of 0.5% for this year, rising to around 1% in 2019.

“With the economy continuing to grow strongly, the more immediate worry on the domestic inflation front centres around increased wage demands, particularly in the public service.

"As the labour market approaches full employment levels, wage growth will pick up,” said Cantor Fitzgerald economist Alan McQuaid.

“Oil prices will be critical in determining the headline inflation outlook over the next 12 months or so, but they remain volatile and hard to predict given the uncertainty over Opec supply and geopolitical tensions in the Middle East, and there are also question marks over global demand,” he said.

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