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Danish inflation dips under 3 percent to reach 18-month low

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Ritzau/The Local - [email protected]
Danish inflation dips under 3 percent to reach 18-month low
Milk is one of the product categories to have increased most in price over the last year. File photo: Liselotte Sabroe/Ritzau Scanpix

Prices for consumer goods in Denmark were up by 2.9 percent in May, the lowest level of inflation since late 2021.

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Data from agency Statistics Denmark published on Monday shows the inflation measure for May at 2.9 percent, down from 5.3 percent in April and the seventh consecutive month in which inflation has fallen.

Inflation was last under 3 percent in October 2021 according to Statistics Denmark records.

A decline in electricity and fall prices has been cited as the main factor in the lower inflation rate, as has been the case since inflation began to drop late last year.

The inflation figure is a comparison of prices compared to one year prior, so the 2.9 percent figure means prices are still increasing overall, albeit at a much lower rate than in late 2022 when inflation exceeded 10 percent.

READ ALSO: Are price increases coming to a halt at Danish shops?

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Overall, the rate at which consumer prices are increasing is slowing “strongly”, according to economist Kristian Skriver of the Danish Chamber of Commerce.

“Consumers are now reaping the benefits of the prices of energy, raw materials and transport having fallen markedly, reducing production costs,” Skriver told news wire Ritzau.

“That places a thick line underneath the worst months of spiralling price increases, which are now a good distance behind us,” he said.

The price of electricity is lower than it was at this point last year, meaning it contributes negatively to the overall inflation index by 1.28 percent points, Statistics Denmark states.

For fuel, the overall contribution to the index is a negative 0.45 percent points.

Food prices have meanwhile pushed the index upwards, with milk, cheese, eggs and sugar products among those for which prices have gone up most since last year.

Food and non-alcoholic drinks pushed the overall inflation index up by 1.3 percent points in May.

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