Inflation down further

In June, Dutch inflation was 0.8 percent, i.e. 0.2 of a percentage point down on May. The decrease was mainly caused by developments in prices of petrol and clothing. Petrol prices were 6.9 percent higher in June than one year previously, whereas in May, they were 11.5 percent up on May 2009. In June, clothes were over 3 percent cheaper than twelve months previously, whereas in May, clothing prices were only 0.7 percent down. Inflation is defined as the increase in the consumer price index (CPI) compared to the same month in the previous year.

With 0.4 of a percentage point, the transport sector accounted for most of June’s inflation. Consumption abroad contributed 0.2 of a percentage point. Housing, water and energy, on the other hand, had a downward effect on inflation of 0.4 of a percentage point.

The harmonised consumer price index (HICP) allows comparison between the inflation rates in the member states of the European Union (EU). According to the HICP, the Dutch inflation rate was 0.2 percent in June. Eurostat, the European statistical office, calculated an inflation rate of 1.4 percent in the eurozone. Energy price adjustments as a result of changes in crude oil prices largely account for the huge gap between the Dutch and eurozone inflation rates. In the Netherlands, adjustments in gas and electricity rates usually become effective in January and July. In most other European countries, gas and electricity rates are adjusted continually.

Dutch inflation