Consumer price index, 15 September 2006

CPI was 119.0 (1998=100) in September 2006, compared to 116.0 at the same time last year. This is equivalent to an increase of 2.6 per cent, compared to 1.9 per cent in August. The year-to-year growth in CPI-ATE was 0.5 per cent in September, up from 0.4 per cent in August.

Strong price increases in September

The Consumer Price Index (CPI) increased by 1.4 per cent from August to September, and the strong growth was due to general price increases in the majority of consumer groups. The strongest contributor to the growth came from electricity, where the tariffs on electricity increased by 21.0 per cent. However, there was a weak decrease in cost connected to transporting energy.

After the August sales activity, prices in clothing and footwear increased by 7.9 per cent in September, while furniture and household textiles increased by 1.9 per cent and 1.8 per cent, respectively.

Prices of recreation and culture services increased by 2.1 per cent, while there was an increase in prices of hotel services of 6.8 per cent. Part of the reason for the price increases in hotel services is due to the fact that from September 2006, there was an 8 percent value-added- tax for room rentals in hotels and related services. Prices connected to education increased by 2.3 per cent since the last survey in January 2006.

Strong increase in electricity in the last 12 months

CPI increased by 2.6 per cent from September 2005 to September 2006, and tariffs on electricity contributed strongly to the growth. The electricity prices fell slightly during the summer, but increased strongly in August and September. The prices are now 48.1 per cent higher than in September 2005.

Increased prices in services contributed to the growth, but to a lesser degree than tariffs on electricity. Prices in recreation and culture increased by 6.3 per cent, and prices in hotel and restaurant services increased by 4.7 per cent in the last twelve months. Prices in transport services in the same period increased by 5.1 per cent.

Prices of clothing and footwear, audiovisual equipments, telephone equipments, and social protections services pulled CPI in the opposite direction. Prices in clothing and footwear fell by 6.0 per cent from September 2005 to September 2006, while audiovisual equipments decreased by 7.4 per cent in the same period. Prices of telephone services and social protection services fell by 7.7 and 12.4 per cent, respectively.

Increase in year-to-year growth

The year-to-year growth in CPI increased by 0.7 percentage points from August to September, from 1.9 per cent in August to 2.6 per cent in September. The strong increase is mainly due to the price development in the prices of electricity. Electricity prices clearly had a strong growth in September this year, compared to the same month last year. Prices in food and non-alcoholic beverages increased by 0.9 per cent in September this year, against zero-change in September last year. Prices of clothing and footwear also contributed to the development in the year-to-year growth.

The growth in the CPI adjusted for tax changes (CPI-AT) was 2.4 per cent in September, an increase in the year-to-year growth of 0.8 percentage points from August. The year-to-year growth in CPI-ATE increased by 0.1 percentage points in September, up from 0.4 per cent in August.