Annual inflation rate falls to 2.6% 

Food prices have increased by 2.5% over the course of the last 12 months. 

The annual rate of inflation has fallen to 2.6% during the month of April, as electricity and gas prices continue to fall, but core inflation still continues to run higher, new data from the Central Statistics Office shows.

According to the data, the headline rate of inflation in April fell from the 2.9% recorded in March but core inflation, which excludes price changes in volatile areas such as food and energy prices, stood at 3.5% in the year to the end of April.

While overall food prices increased by 2.5% during the last 12 months, the price of electricity has fallen by 22.2% in that time while gas prices fell 18.7%.

The areas that saw the highest levels of price increases were recreation and culture, which was up 5.2% during the last year, while prices at restaurants and hotels were up 4.8%.

The increase in recreation and culture was largely due to higher prices for package holidays and participation in recreational and sporting services.

Price increases in hotels and restaurants were mainly due to higher prices for alcoholic drinks and food consumed in licensed premises as well as an increase in the cost of hotel accommodation.

In addition, transport costs increased due in part to higher prices for diesel and petrol both of which are up 12.5% and 10.6% compared to last year. At the start of April, the Government began phasing out temporary cuts to excise duties which saw prices at the pumps increase.

The cost of car and motorbike insurance also rose by 5.9% while health insurance prices rose by 11.9%.

There were some areas that did see prices drop such as clothing and footwear where prices fell by 6.7% during the year - due to a decrease in sales.

Next month, the European Central Bank is due to meet where it is widely expected to announce its first cuts to interest rates since it started increasing them nearly two years ago. The ECB has been attempting to get inflation down to its medium-term target of 2%.