Government ‘must help small firms and curb inflation’

AS inflation heads to 5% top economist Jim Power says the one area where the Government can intervene is in the area of insurance inflation which is driving small firms to the wall.

Ireland’s headline annual inflation rate was 4.5% in September, the same as in August, but up from 4.2% in July, and 4.4% in June. For the first nine months of the year inflation averaged 4.6% compared with overall annual increases of 4.9% and 5.6% in 2001 and 2000 respectively.

Chief economist with Friends First Jim Power says the inflationary psychology which appears to have become ingrained in Irish consumers might be about to come to an end and restaurants could be the first to bear the brunt of consumer resistance as they price themselves out of the market. Restaurants, hotels and licensed premises are up +7.3% this year.