The annual irate of inflation has risen to 1.5% in Luxembourg.
In July 2018, the consumer price index, calculated by STATEC, fell by 0.7% compared to the previous month. As is the case every year, this decline is explained by the price reductions offered during the summer sales. By offsetting changes in balances and excluding petroleum products, prices for other goods and services increased 0.3%. The results for July triggered an index tranche which saw a 2.5% increase of wages, salaries and pensions on 1 August 2018.
Indeed, some sections witnessed sharp declines in July due to the summer sales. The prices in the apparel & footwear division, for example, dropped by 14.0%. To a lesser extent, furniture (-4.2%) and home appliances (-2.4%) suffered declines during this period. However, this is expected to be neutralised next month, with indices returning to normal levels.
Meanwhile, prices for petroleum products have been on an upward trend since April. In July, the petroleum products index rose by 0.5% from the previous month. At the pump, prices fell by 0.3% for diesel and by 0.2% for gasoline in July.
Similarly, package holidays gave July its highest increases with travel prices rising by 7.2% in one month. This contrasts with the food sector, where the monthly price decreased for fresh fruit and non-alcoholic beverages but that of vegetables and fresh fish increased. In annual comparison, food prices are 2.1% higher.
All things considered, the annual rate of inflation in Luxembourg has therefore reached 1.5%, compared to 1.4% a month earlier. The underlying annual inflation rate lost 0.1% and reached 0.7%.
