Premiums, rents, and education costs soar

Car insurance, rents, and education have posted the largest price gains since 2012, official figures published yesterday showed.

The CSO figures showed that from 2012 to the end of 2016 car premiums soared by over 49%, private landlord rents climbed 30.5% and education prices rose by 18.5%.

Over the same period, alcoholic beverages and tobacco, up over 11%, and prices at restaurants and hotels, up 8%, also posted large increases.

In contrast, mortgage interest costs dropped by 28.7% and energy products fell over 15%, while food and non-alcoholic beverages fell by 4.6% over the same period.

Last year, mortgage interest costs and the costs of energy products also ranked among the largest falls.

Mortgage interest costs have fallen as pressure built on lenders to cut their standard variable mortgage costs, which remain the highest in the eurozone.

Fuel costs have fallen as the price of crude oil tumbled on world markets over the past 18 months.

The CSO said prices in December were unchanged from November and from December 2016. In 2015, Ireland’s annual rate of inflation was minus 0.3%.

“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 potential Opec output cuts,” said Alan McQuaid, chief economist at Merrion Capital.

“Still, we think prices will be higher on average this year than in 2016.”

“Aggressive” wage demands could damage the economic recovery, Mr McQuaid added.