Ireland’s harmonised inflation rises to four per cent

Ireland’s harmonised index of consumer prices was 4.0 per cent above its year-earlier level in October, according to the statistics office’s flash estimate published on 3 November. For Hungarian companies working with Irish partners, this provides context on local costs, but price changes in their contracts need comparison with their actual basket of products.

The CSO release gives September’s annual rate as 3.8 per cent; October’s monthly change was 0.5 per cent. Energy prices rose 18.3 per cent annually, while the measure excluding energy and unprocessed food was 2.5 per cent.

Our calculation subtracts 3.8 from 4.0 to give 0.2 percentage points: the acceleration in annual inflation. This measures the change in the rate, whereas the separately reported 0.5 per cent describes the monthly change in prices. The different measures therefore belong in separate columns in a business comparison. Adding the annual and monthly changes would produce an incorrect cost estimate because they refer to different comparison periods.

October EU economic sentiment measures expectations, while the first Hungarian GDP estimate measures output. Neither directly determines an Irish supplier’s next invoice. Nor can the Irish rate automatically be applied to Hungarian inflation: the country and consumption structure differ. The CSO schedules detailed October CPI and HICP data for 12 November, when the present flash estimate can be compared with the detailed breakdown.