Inflation at 5.7 percent in June according to flash estimate

An inflation rate of 5.7 percent in June 2023 means that prices of consumer products were on average 5.7 percent higher than in June 2022. The 5.7-percent inflation is therefore not on top of the 6.1-percent inflation of May.

Price development of product groups

In addition to the inflation rate, CBS also publishes the price development of a number of product groups as part of its flash estimate. These product groups are aggregations of expenditure categories on a particular theme, such as all services. The price development of all categories in the CPI will be published on 11 July.

New energy price measurement method

As of June 2023, CBS uses a new method to measure energy prices and incorporate them in the CPI. This new method allows for a more accurate CPI calculation. Under the new methodology, CBS collects household contract data from energy suppliers. These data show exactly what rates households are actually paying for gas and electricity. The old energy price methodology relied solely on data from new contracts offered by energy suppliers.

The method change affects the inflation rate. The inflation rate for June 2023 is the difference between the CPI for June 2023 and June 2022. However, while the current CPI uses the new method for measuring energy prices, the June 2022 CPI is based on the old method. This means that the inflation rate for June 2023 contains a so-called ‘method break’. Today, CBS publishes a background article, CBS switches to new method for calculating energy prices in the CPI, explaining in more detail what this switch means for the CPI, the inflation rate and the use of the CPI for indexation purposes.

HICP flash estimate

As of 1996, CBS publishes two different inflation rates. One based on the Consumer Price Index (CPI) and one on the Harmonised Index of Consumer Prices (HICP). According to the HICP flash estimate, inflation stood at 6.4 percent in June. This was 6.8 percent in May.

In order to facilitate comparison between countries, EU member states calculate a consumer price index according to internationally agreed definitions and methods. Eurostat calculates the inflation rates for the euro area and the European Union based on these harmonised indices (HICP) from all EU countries. 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.

For the Netherlands, the main difference between the CPI and the HICP is that, unlike the CPI, the HICP does not take into account the costs related to home ownership. In the CPI, these costs are calculated on the basis of rental property prices. However, this is not the only difference. This is further explained in a publication.