CPI up 1.3 per cent last 12 months
The Consumer Price Index (CPI) rose by 0.7 per cent from June 2020 to July 2020, while the CPI-ATE growth was 0.9 per cent in the same period. From July 2019 to July 2020 the CPI rose by 1.3 per cent, while the CPI-ATE increased by 3.5 per cent.
Actions taken by the Government to limit the corona virus outbreak have implications for the CPI also in July. Even though most services are available again and is included as normal in the CPI, some services regarding travel amongst other are still being treated separately. Services with close to zero consumption in July accounts for about 2.5 per cent of total CPI measured in terms of the CPI weights, and prices on these services are mainly estimated based on seasonal factors.
Figure 1. 12-month rate, CPI and CPI-ATE
Price increase in July
The overall CPI rose by 0.7 per cent from June to July 2020. The rise was mainly caused by an increase in prices on food, which rose 3.7 per cent. It was higher prices on meat, as well as dairy and sweets and other sugary products, which contributed to the rise in the food prices. The prices for non-alcoholic beverages showed only a moderate increase in the period, which can be attributed by a relief in government taxes introduced in July.
The prices for transport services and fuels and lubricants for personal transport equipment also contributed to the rise in the overall CPI. The price increase for transport services was among others caused by the prices for international flights, which were estimated with a seasonal factor.
Prices on clothing and footwear pulled the CPI in the opposite direction. Clothing and footwear usually show a price decrease in July as a result of summer sales, and from June to July 2020 the prices fell 2.8 per cent. The price decrease on clothing was weaker this year compared to July previous years.
Figure 2. Monthly change in per cent. CPI, CPI-ATE, CPI by divisons
|June 2020 - July 2020||June 2019 - July 2019|
|Miscellaneous goods and services||0.6||0.2|
|Restaurants and hotels||0.4||-0.3|
|Recreation and culture||0.1||-0.1|
|Furnishings, household equipment and routine maintenance||1||0.6|
|Housing, water, electricity, gas and other fuels||-0.1||0.4|
|Clothing and footwear||-2.8||-5.5|
|Alcoholic beverages and tobacco||0.6||0.4|
|Food and non-alcoholic beverages||3.3||4.2|
|CPI -ATE All-item index||0.9||0.6|
|CPI All-item index||0.7||0.7|
Increased food prices last twelve months
The overall CPI rose by 1.3 per cent from July 2019 to July 2020. Prices on food contributed the most with price increases of 2.7 per cent in this period. Higher prices on restaurant and cultural services also contributed to the rise in the CPI. Altogether prices on services rose by 2.7 per cent from July 2019 to July 2020. In addition, purchase of vehicles also contributed to the overall price growth, with a price increase of 2.8 per cent in the same period.
The increase in the overall CPI was dampened by the prices on electricity including grid rent, which showed a decrease of 35.1 per cent from July 2019 to July 2020.
Increased year-to-year growth in the CPI-ATE
The year-to-year growth in the CPI-ATE was 3.5 per cent in July 2020, an increase of 0.4 percentage points from June 2020. In addition to the price development on goods and services mentioned above, the year-to-year growth for the CPI-ATE is amongst other affected by tax reliefs on non-alcoholic beverages from July. The growth in the CPI-ATE is also affected by the temporary changes in tax rates related to the Corona pandemic.
The year-to-year growth in the CPI fell from 1.4 per cent in June to 1.3 per cent in July.
Figure 3. 12-month rate. CPI, CPI-ATE, CPI by divisions. July 2019 - July 2020
|July 2019 - July 2020|
|Miscellaneous goods and services||4.2|
|Restaurants and hotels||2.1|
|Recreation and culture||3.4|
|Furnishings, household equipment and routine maintenance||7.5|
|Housing, water, electricity, gas and other fuels||-4.4|
|Clothing and footwear||2.1|
|Alcoholic beverages and tobacco||2.9|
|Food and non-alcoholic beverages||2.2|
|CPI -ATE All-item index||3.5|
|CPI All-item index||1.3|