Ireland’s Inflation Slows to Four-Month Low in June as Food and Fuel Pressures Ease

Ireland’s annual consumer price inflation eased to a four-month low of 3.4% in June, offering some relief to households despite continued increases in housing, education and other essential living costs, according to new figures released by the Central Statistics Office (CSO).

The inflation rate fell from 3.6% recorded in May, matching the preliminary estimate published earlier by the CSO. On a monthly basis, consumer prices increased by 0.3% during June.

Although overall inflation slowed, several household expenses continued to rise. Third-level education costs increased during the month, while renters and homeowners faced higher accommodation-related expenses, including rent, mortgage interest repayments and home heating oil costs.

Among the major spending categories, Education Services recorded the strongest annual increase, with prices rising by 8.9%. Housing, Water, Electricity, Gas and Other Fuels followed with a 7.3% increase over the past year.

Clothing and Footwear prices climbed by 7%, while Insurance and Financial Services rose by 5.7% compared with June last year.

Monthly changes showed mixed trends across different sectors. Recreation, Sport and Culture experienced the largest increase, with prices rising 4.3% during June. Housing-related costs also edged higher by 0.6%.

By contrast, Clothing and Footwear prices declined by 0.9% during the month, while Transport costs fell by 0.8%, helping to moderate the overall rise in consumer prices.

Deloitte Ireland Chief Economist Kate English said recent data suggested inflationary pressures had eased compared with earlier this year, although overall price growth remained above levels seen at the beginning of the year.

She noted that food inflation has continued to slow and has reached its lowest level since September 2021. However, she cautioned that rising fertiliser costs could place renewed pressure on food prices in the months ahead.

English also pointed to lower fuel prices as a key reason inflation eased after the sharp increase recorded in March. At the same time, she warned that European gas markets remain vulnerable. Demand for electricity used in cooling systems has increased during the recent heatwave across Europe, pushing gas prices higher. Gas storage levels also remain below their five-year average, raising concerns ahead of the winter season.

Attention is now turning to the European Central Bank’s next monetary policy meeting. The ECB raised interest rates last month for the first time since September 2023 in response to inflation concerns. Economists currently expect policymakers to leave rates unchanged at their upcoming meeting, although next week’s eurozone inflation figures will be closely watched before any decision is made.

Alongside its inflation report, the CSO also released updated national average prices for a range of everyday grocery and household items, providing further insight into changes in the cost of living across Ireland.