POLITICS & INSTITUTIONS - ECONOMY

Yearly fluctuations

Annual inflation rate down by 0.4%



While food prices have increased over a year, the downward trend in fossil fuel costs at the end of 2021 brought the entire annual inflation rate down.  Photo: Sara Kurfeß/Unsplash 

While food prices have increased over a year, the downward trend in fossil fuel costs at the end of 2021 brought the entire annual inflation rate down.  Photo: Sara Kurfeß/Unsplash 

The price of fuel fell in December, generating a 0.1% decrease of the national consumer price index in comparison to November, and resulting in a lower yearly inflation rate. Meanwhile, the price of fresh vegetables, cars and air transport went up.

Consumers will have paid 7.6% less for a tank of heating oil, 6.8% less for petrol and 4.5% less for diesel in December. This is what the Luxembourg statistics bureau Statec notes in a monthly report published on 5 January. After a three month increase in fossil fuel prices, consumers can finally breathe a little, although, as Statec notes, the prices for December 2021 are still 46.9% higher than at the end of 2020.

The abrupt halt to consumption during the 2020 lockdown and the ensuing rebound are cited as reasons.

The cost of fresh fruit (-3.8%), baby food (-2.0%), seafood (-.3.3%) and alcoholic drinks (-0.5%) all also fell. In the case of alcohol, as with toys and games(-11%), the downward trend is due to the end-of-year-related sales, says Statec.

On the other side of the scales, though, fresh vegetables (5%), pasta and couscous (3.5%), fresh fish (3.2%) as well as restaurant food (0.4%) saw prices increase. The yearly fluctuation of prices shows a 2.4% inflation for food products in general. 

Citing the school holiday and seasonal movements, Stated also noted a steep increase in the price of plane tickets (22.1%). Package tours were also affected, though the price tag was only 5.4% higher than the previous month.

Overall, health (7.94%), housing, water, electricity and fuels (8.26%) and transportation (7.94%) witnessed the most important fluctuations over 2021, while education (0.85%), clothing (0.74%) and communications (-2.19%) witnessed the smallest changes over the same time period.

The annual inflation rate dropped between the end of 2020 (4.5%) and the end of 2021 too, reaching  a rate of 4.1% rate in December 2021. This decrease can mainly be explained by the 4.8% decrease in petrol prices between November 2021 and December 2021.