Consumers facing an expensive Christmas as food and energy prices soar

'With winter energy bills kicking in and Christmas fast approaching, the high inflation that consumers have been grappling with for so long will be felt all the more acutely this time of year.'

Consumers are set to feel the pinch as Christmas draws closer, as grocery bills and energy price hikes saw inflation rise at its fastest rate in 18 months to 2.9% in the year to October.

The latest figures from the Central Statistics Office show households continue to be hit with sharp price rises for many essentials, with the cost of meat, milk, butter and coffee all recording double-digit percentage hikes in the last year.

Health insurance price rises are more than double that of general inflation, while recent price increases announced by energy companies will soon be reflected in the Consumer Price Index figures.

“This is the highest rate of inflation since March 2024, when it was also +2.9%,” CSO statistician Anthony Dawson said. “Furnishings, household equipment and routine household maintenance (-0.4%) was the only division to show a decline when compared with October 2024.

“There were price increases in the 12 months to October 2025 for Irish cheddar per kilo (+80c), a pound of butter (+64c), 2l of full fat milk (+22c), an 800g loaf of white sliced pan (+7c), an 800g loaf of brown sliced pan (+3c), and spaghetti per 500g (+1c).” 

Making the biggest contribution to the 2.9% inflation over the past 12 months was restaurants and hotels. The CSO said these rose mainly due to higher prices for alcoholic drinks and food consumed in licensed premises, restaurants and cafes.

As a whole, insurance is up 6.7% in the last year, with health insurance up 7.7% and car insurance up 3.9%. Electricity, meanwhile, is up 3.7%, while rents have risen 3.6%.

All of it adds to more pressure on household budgets heading into the pricey Christmas period, according to Geraldine Kelly, head of personal lines at brokers Gallagher.

“With winter energy bills kicking in and Christmas fast approaching, the high inflation that consumers have been grappling with for so long will be felt all the more acutely this time of year,” she said.

With poultry prices up 6.6%, the cost of the Christmas turkey is also likely to be much more expensive this year too. So many families will feel the financial squeeze of grocery inflation.

“Not everyone has a financial cushion to fall back on to tide them over the more expensive months of the year. Unfortunately, higher winter energy bills coupled with the extra cost of Christmas can unfortunately lead to debt and other problems down the line.”