Luxembourg Inflation Forecasts Revised Down, Drops to 0.6% in April

The national statistical agency Statec has revised down its forecasts for inflation in Luxembourg to 0.6% for 2020 and 1.6% for 2021.

The downward revision comes amid the collapse in oil prices and economic deterioration which have stemmed from the COVID-19 pandemic and associated containment measures.

In this context, STATEC has revised its forecasts down from almost 2% (as anticipated back in February) to 0.6% and 1.6% for the years 2020 and 2021 respectively. 

The statistical agency also announced that the annual inflation rate dropped from 0.9% to 0.6% in April 2020; the national consumer price index fell by 0.1% compared to the previous month. This decrease has been attributed to the continued drop in petroleum product prices, which fell by 12.7% between March and April 2020.

Moreover, the COVID-19 crisis has resulted in significant variations for some food products. Overall, food prices increased by 1.7% over one month, with price increases mainly affecting fresh fruit (up 8.7%) and vegetables (up 11.8%). Meanwhile, fresh fish (down 17.5%), seafood (down 2.4%) and chocolate (down 3.6%) experienced price drops in April. Compared to last year, food prices rose by 4.5%.