Inflation rate eases but motor insurance premiums rise for the 10th month in a row.

In June, the overall inflation rate dipped slightly, yet motor insurance premiums continued to climb.

The consumer prices index, which tracks inflation, increased by 2.2% from June last year to June. This rise is a decrease from the 2.6% annual rate recorded in May, according to the Central Statistics Office (CSO).

Since September 2021, this is the eighth instance where the annual growth in the consumer price index has stayed below 5%.

In June, prices for goods and services went up by 0.4%.

Motor insurance costs increased for the tenth consecutive month in June, rising by 8.3% over the past year.

Insurers attribute the surge in premium costs to a higher number and increased value of vehicle damage claims.

Experts emphasize that a lower inflation rate in June doesn’t mean prices are dropping. The figures indicate that prices are still rising, but not as rapidly as before.

Given the steep price hikes over the past two years, experts believe it could take at least two years for people to regain the purchasing power and standard of living they had before inflation surged following the Russian invasion of Ukraine.

Over the last two years, prices for goods and services have cumulatively risen by around 20%.

In June, the CSO noted significant monthly price changes, particularly in the recreation and culture sector due to costlier package holidays. Prices in restaurants and hotels rose due to higher costs for alcoholic drinks, food consumed in licensed premises, and hotel accommodation.

However, prices for furniture and furnishings decreased in June.

Alcoholic beverages and tobacco prices fell, primarily because of lower prices for spirits and wine sold in supermarkets and off-licenses, according to the CSO.

Food and non-alcoholic beverage prices were up by 2.1% in the year to June.

CSO statistician Anthony Dawson highlighted that a 2.5kg bag of potatoes saw a price increase of 70 cents in June. Earlier wet weather has led to a potato shortage.

Conversely, June saw a decrease in the price of Irish cheddar cheese per kilogram, down by 13 cents. An 800g loaf of white sliced pan dropped by 5 cents, and two liters of full-fat milk were 4 cents cheaper compared to June 2023.

Excluding energy and unprocessed food, inflation rose by 3.1% in the 12 months to June this year.

While the overall inflation rate has been steadily declining from a peak of around 10%, energy and food prices remain high for households.