Strongest inflation in almost 20 years

04/11/2021 15:00

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Statistics Netherlands (CBS) reports that the consumer price index (CPI) was 3.4 percent higher in October than in the same month last year. The inflation rate stood at 2.7 percent in September. The inflation rate in October was the highest in nearly 20 years. The price development of gas and electricity, among other things, contributed to the higher inflation.

Consumer price index (CPI)
Year	Month	Year-on-year change (year-on-year % change)
2015	January	0
2015	February	0.2
2015	March	0.4
2015	April	0.6
2015	May	1.1
2015	June	1
2015	July	1
2015	August	0.8
2015	September	0.6
2015	October	0.6
2015	November	0.7
2015	December	0.7
2016	January	0.6
2016	February	0.6
2016	March	0.6
2016	April	0
2016	May	0
2016	June	0
2016	July	-0.2
2016	August	0.2
2016	September	0.1
2016	October	0.4
2016	November	0.6
2016	December	1
2017	January	1.7
2017	February	1.8
2017	March	1.1
2017	April	1.6
2017	May	1.1
2017	June	1.1
2017	July	1.3
2017	August	1.4
2017	September	1.5
2017	October	1.3
2017	November	1.5
2017	December	1.3
2018	January	1.5
2018	February	1.2
2018	March	1
2018	April	1.1
2018	May	1.7
2018	June	1.7
2018	July	2.1
2018	August	2.1
2018	September	1.9
2018	October	2.1
2018	November	2
2018	December	2
2019	January	2.2
2019	February	2.6
2019	March	2.8
2019	April	2.9
2019	May	2.4
2019	June	2.7
2019	July	2.5
2019	August	2.8
2019	September	2.6
2019	October	2.7
2019	November	2.6
2019	December	2.7
2020	January	1.8
2020	February	1.6
2020	March	1.4
2020	April	1.2
2020	May	1.2
2020	June	1.6
2020	July	1.7
2020	August	0.7
2020	September	1.1
2020	October	1.2
2020	November	0.8
2020	December	1
2021	January	1.6
2021	February	1.8
2021	March	1.9
2021	April	1.9
2021	May	2.1
2021	June	2
2021	July	1.4
2021	August	2.4
2021	September	2.7
2021	October	3.4

Consumer price index (CPI)
Year	Month	Year-on-year change (year-on-year % change)
2015	January	0
2015	February	0.2
2015	March	0.4
2015	April	0.6
2015	May	1.1
2015	June	1
2015	July	1
2015	August	0.8
2015	September	0.6
2015	October	0.6
2015	November	0.7
2015	December	0.7
2016	January	0.6
2016	February	0.6
2016	March	0.6
2016	April	0
2016	May	0
2016	June	0
2016	July	-0.2
2016	August	0.2
2016	September	0.1
2016	October	0.4
2016	November	0.6
2016	December	1
2017	January	1.7
2017	February	1.8
2017	March	1.1
2017	April	1.6
2017	May	1.1
2017	June	1.1
2017	July	1.3
2017	August	1.4
2017	September	1.5
2017	October	1.3
2017	November	1.5
2017	December	1.3
2018	January	1.5
2018	February	1.2
2018	March	1
2018	April	1.1
2018	May	1.7
2018	June	1.7
2018	July	2.1
2018	August	2.1
2018	September	1.9
2018	October	2.1
2018	November	2
2018	December	2
2019	January	2.2
2019	February	2.6
2019	March	2.8
2019	April	2.9
2019	May	2.4
2019	June	2.7
2019	July	2.5
2019	August	2.8
2019	September	2.6
2019	October	2.7
2019	November	2.6
2019	December	2.7
2020	January	1.8
2020	February	1.6
2020	March	1.4
2020	April	1.2
2020	May	1.2
2020	June	1.6
2020	July	1.7
2020	August	0.7
2020	September	1.1
2020	October	1.2
2020	November	0.8
2020	December	1
2021	January	1.6
2021	February	1.8
2021	March	1.9
2021	April	1.9
2021	May	2.1
2021	June	2
2021	July	1.4
2021	August	2.4
2021	September	2.7
2021	October	3.4

Rising energy prices

The increase in inflation was mainly due to higher electricity and gas prices. The year-on-year price increase for gas went up from 18.3 percent in September to 30.6 percent in October. Electricity was 39.6 percent more expensive in October than one year previously. In September, the year-on-year price increase was 24.4 percent.

Price index gas
Month	2021 (2015=100)	2020 (2015=100)
January	127.59	130.57
February	128.89	129.91
March	129.99	128.54
April	130.69	127.12
May	130.63	126.43
June	132.32	125.91
July	137.73	122.96
August	139.54	123.06
September	145.74	123.22
October	161.18	123.39

Price index gas
Month	2021 (2015=100)	2020 (2015=100)
January	127.59	130.57
February	128.89	129.91
March	129.99	128.54
April	130.69	127.12
May	130.63	126.43
June	132.32	125.91
July	137.73	122.96
August	139.54	123.06
September	145.74	123.22
October	161.18	123.39

Motor fuels and clothing also more expensive

The price development of motor fuels also had an upward effect on inflation. Motor fuels were 27.3 percent more expensive in October than one year previously. In September, the year-on-year price increase was 20.4 percent. Consumers paid an average of 1.94 euros per litre for petrol, 1.61 euros for diesel and 0.89 euros for LPG in October. The price development of clothing also contributed to higher inflation.

CPI: Major contributions to year-on-year change
	October (percentage point)	September (percentage point)
All items	3.4	2.7

Housing, water and energy	1.40	0.97
Transport	1.12	0.91
Miscellaneous goods and services	0.24	0.26
Furnishing and household equipment	0.22	0.19
Recreation and culture	0.18	0.18
Restaurants and hotels	0.13	0.19
Clothing and shoes	0.11	0.01
Education	-0.30	-0.30

CPI: Major contributions to year-on-year change
	October (percentage point)	September (percentage point)
All items	3.4	2.7

Housing, water and energy	1.40	0.97
Transport	1.12	0.91
Miscellaneous goods and services	0.24	0.26
Furnishing and household equipment	0.22	0.19
Recreation and culture	0.18	0.18
Restaurants and hotels	0.13	0.19
Clothing and shoes	0.11	0.01
Education	-0.30	-0.30

Increase HICP in the euro area 4.1 percent

Aside from the consumer price index (CPI), CBS also calculates the European harmonised consumer price index (HICP). According to the European HICP, consumer goods and services in the Netherlands were 3.7 percent more expensive in October than in the same month last year, up from 3.0 percent in September. Inflation in the euro area rose from 3.4 to 4.1 percent.

Harmonised Index of Consumer Prices (HICP)
year	month	The Netherlands (year-on-year % change)	Euro area (year-on-year % change)
2015	January	-0.7	-0.6
2015	February	-0.5	-0.3
2015	March	-0.3	-0.1
2015	April	0	0.2
2015	May	0.7	0.6
2015	June	0.5	0.5
2015	July	0.8	0.5
2015	August	0.4	0.4
2015	September	0.3	0.2
2015	October	0.4	0.4
2015	November	0.4	0.1
2015	December	0.5	0.3
2016	January	0.2	0.3
2016	February	0.3	-0.1
2016	March	0.5	0
2016	April	-0.2	-0.3
2016	May	-0.2	-0.1
2016	June	-0.2	0
2016	July	-0.6	0.2
2016	August	0.1	0.2
2016	September	-0.1	0.4
2016	October	0.3	0.5
2016	November	0.4	0.6
2016	December	0.7	1.1
2017	January	1.6	1.7
2017	February	1.7	2
2017	March	0.6	1.5
2017	April	1.4	1.9
2017	May	0.7	1.4
2017	June	1	1.3
2017	July	1.5	1.3
2017	August	1.5	1.5
2017	September	1.4	1.6
2017	October	1.3	1.4
2017	November	1.5	1.5
2017	December	1.2	1.3
2018	January	1.5	1.3
2018	February	1.3	1.1
2018	March	1	1.4
2018	April	1	1.2
2018	May	1.9	2
2018	June	1.7	2
2018	July	1.9	2.2
2018	August	1.9	2.1
2018	September	1.6	2.1
2018	October	1.9	2.3
2018	November	1.8	1.9
2018	December	1.8	1.5
2019	January	2	1.4
2019	February	2.6	1.5
2019	March	2.9	1.4
2019	April	3	1.7
2019	May	2.3	1.2
2019	June	2.7	1.3
2019	July	2.6	1
2019	August	3.1	1
2019	September	2.7	0.8
2019	October	2.8	0.7
2019	November	2.6	1
2019	December	2.8	1.3
2020	January	1.7	1.4
2020	February	1.3	1.2
2020	March	1.1	0.7
2020	April	1	0.3
2020	May	1.1	0.1
2020	June	1.7	0.3
2020	July	1.6	0.4
2020	August	0.3	-0.2
2020	September	1	-0.3
2020	October	1.2	-0.3
2020	November	0.7	-0.3
2020	December	0.9	-0.3
2021	January	1.6	0.9
2021	February	1.9	0.9
2021	March	1.9	1.3
2021	April	1.7	1.6
2021	May	2	2
2021	June	1.7	1.9
2021	July	1.4	2.2
2021	August	2.7	3
2021	September	3	3.4
2021	October	3.7	4.1

Harmonised Index of Consumer Prices (HICP)
year	month	The Netherlands (year-on-year % change)	Euro area (year-on-year % change)
2015	January	-0.7	-0.6
2015	February	-0.5	-0.3
2015	March	-0.3	-0.1
2015	April	0	0.2
2015	May	0.7	0.6
2015	June	0.5	0.5
2015	July	0.8	0.5
2015	August	0.4	0.4
2015	September	0.3	0.2
2015	October	0.4	0.4
2015	November	0.4	0.1
2015	December	0.5	0.3
2016	January	0.2	0.3
2016	February	0.3	-0.1
2016	March	0.5	0
2016	April	-0.2	-0.3
2016	May	-0.2	-0.1
2016	June	-0.2	0
2016	July	-0.6	0.2
2016	August	0.1	0.2
2016	September	-0.1	0.4
2016	October	0.3	0.5
2016	November	0.4	0.6
2016	December	0.7	1.1
2017	January	1.6	1.7
2017	February	1.7	2
2017	March	0.6	1.5
2017	April	1.4	1.9
2017	May	0.7	1.4
2017	June	1	1.3
2017	July	1.5	1.3
2017	August	1.5	1.5
2017	September	1.4	1.6
2017	October	1.3	1.4
2017	November	1.5	1.5
2017	December	1.2	1.3
2018	January	1.5	1.3
2018	February	1.3	1.1
2018	March	1	1.4
2018	April	1	1.2
2018	May	1.9	2
2018	June	1.7	2
2018	July	1.9	2.2
2018	August	1.9	2.1
2018	September	1.6	2.1
2018	October	1.9	2.3
2018	November	1.8	1.9
2018	December	1.8	1.5
2019	January	2	1.4
2019	February	2.6	1.5
2019	March	2.9	1.4
2019	April	3	1.7
2019	May	2.3	1.2
2019	June	2.7	1.3
2019	July	2.6	1
2019	August	3.1	1
2019	September	2.7	0.8
2019	October	2.8	0.7
2019	November	2.6	1
2019	December	2.8	1.3
2020	January	1.7	1.4
2020	February	1.3	1.2
2020	March	1.1	0.7
2020	April	1	0.3
2020	May	1.1	0.1
2020	June	1.7	0.3
2020	July	1.6	0.4
2020	August	0.3	-0.2
2020	September	1	-0.3
2020	October	1.2	-0.3
2020	November	0.7	-0.3
2020	December	0.9	-0.3
2021	January	1.6	0.9
2021	February	1.9	0.9
2021	March	1.9	1.3
2021	April	1.7	1.6
2021	May	2	2
2021	June	1.7	1.9
2021	July	1.4	2.2
2021	August	2.7	3
2021	September	3	3.4
2021	October	3.7	4.1

The HICP is compiled according to the European harmonised method to facilitate comparison across EU member states. Price indices for the euro area and the European Union as a whole are calculated based on the HICPs of the individual member states. The European Central Bank (ECB) uses these figures to formulate its monetary policy.

The main conceptual difference between the CPI and the HICP for the Netherlands is that, unlike the CPI, the HICP does not take into account the costs of homeownership. In the Dutch CPI, these costs are calculated based on developments in rental property prices.

Implications of the coronavirus crisis for consumer price measurements

Due to the government's COVID-19 countermeasures, some services have been either limited or unavailable since April 2020, such as intercontinental flights in October. As a result, there were no transactions for some of these services that allowed for price measurements. In accordance with the Eurostat guidelines, CBS opted for the most appropriate estimation method in each situation.

The coronavirus pandemic has significantly changed consumers’ spending patterns. The change in consumption patterns will affect inflation in 2021.

Sources

StatLine - Consumer prices
Custom - CPI; Overview COVID-19 adjustments, as from April 2021

Rising energy prices

Motor fuels and clothing also more expensive

Increase HICP in the euro area 4.1 percent

Implications of the coronavirus crisis for consumer price measurements

Sources

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