Inflation falls to 1.1% on sharp energy price drop

Core inflation, which excludes food and energy, rose by 2.3%.

Inflation in Ireland has fallen sharply to a new low of 1.1%.

New data from the Central Statistics Office (CSO) shows prices rose 1.1% for the 12 months to August compared with 1.5% for the 12 months to July. The Harmonised Index of Consumer Prices (HICP) rate in Ireland compares favourably with the 2.6% rate for the Eurozone with updated figures expected to be published on Friday.

The CSO said energy prices in Ireland fell by 9.5% while food prices increased by 2% over the past year. Transport costs rose by 4.3% in the 12 months. 

The HICP excluding energy and unprocessed food, which measures core inflation, is estimated to have gone up by 2.3% since August 2023.

Despite the drop in energy prices for consumers, separate data from the CSO on Thursday shows wholesale electricity prices rose by 15.3% in the 12 months to July. 

Domestic producer prices for manufactured goods were on average 0.4% higher in July when compared with a year earlier, while producer prices for exported goods were up by 5.6%. Overall, manufacturing producer prices were 5.4% higher in the year.

Deirdre Toher, statistician in the Prices Division, said wholesale price inflation showed an increase in July 2024 with a rise of 0.2% in the overall Producer Price Index for manufacturing industries in the month. 

"The price index for export sales was up by 0.2% since June 2024, while the index for home sales was up by 0.1% in the month. Producer prices for products sold on the domestic market were 0.4% higher in July 2024 compared with July 2023," she said.