Inflation rate down to 8.8 percent in May

Smaller increase in energy prices

The lower inflation rate was mainly due to the price development of energy (electricity, gas and district heating). In May, energy was 105 percent more expensive than one year previously. In April, this was 136 percent.

Energy currently makes a significant contribution to overall inflation. The price development of energy is measured by CBS on the basis of new contracts. CBS has started research on the measurement of energy prices in the CPI.

Motor fuels more expensive

The price development of motor fuels, however, had an upward effect on the inflation rate. The price increase of motor fuels amounted to 23.8 percent relative to May 2021. In April, motor fuels were 20.1 percent more expensive than one year previously. The average price for a litre of petrol at the pump rose from 2.09 euros in April to 2.19 euros in May. In April, the price of petrol had fallen compared to the previous month, as a result of the reduced excise duty on motor fuels.

Food more expensive

The price development of food had an upward effect on inflation as well. Food was 9.1 percent more expensive in May than one year previously. In April, food prices were up by 8.5 percent. This is mainly due to the price development of meat; the year-on-year price increase went up from 10.5 percent in April to 13.9 percent in May. Sugar and confectionery, oils and fats and cheese and quark products also became more expensive.

Smaller inflation gap between the Netherlands and the euro area

Since 1996, CBS has published two different inflation rates: one based on the Consumer Price Index (CPI) and one based on the Harmonised Index of Consumer Prices (HICP). According to the European HICP, consumer goods and services in the Netherlands were 10.2 percent more expensive in May than in the same month last year, down from 11.2 percent in April. Inflation in the euro area rose from 7.4 percent in April to 8.1 percent in May.

Difference between CPI and HICP

In order to facilitate comparison between countries, EU member states calculate a consumer price index according to internationally agreed definitions and methods. The European Central Bank (ECB) uses the HICP to formulate its monetary policies in the euro area. In addition, most countries produce their own national consumer price index.

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 related to home ownership. 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, several services have been either limited or unavailable since April 2020. As a result, there were no transactions that allowed for price measurements for some of the services. In accordance with the Eurostat guidelines, CBS has opted for the most appropriate estimation method in each situation. In May 2022, prices were no longer estimated in connection with COVID-19, but estimates made in the same month a year earlier still affect this month's inflation.