Weak consumer demand to keep up pressure on prices

The traditional new year sales pushed prices for clothing and footwear down by 11%, dragging consumer prices down by 0.5% in January.

Despite the large reduction in the cost of clothing and footwear, household equipment and maintenance, which was also down 3.1%, the fall in prices was offset by increases in the cost of alcoholic beverages and tobacco, up 5.4%, and health costs up 1.1%.

The overall effects of the price variations has been to leave the annual rate of inflation unchanged at 1.2%. Merrion stockbrokers’ Alan McQuaid said weak demand and a lack of disposable income was keeping inflation down.