Luxembourg Inflation Rate Falls from 3.6% to 3.2%

On Wednesday 5 July 2023, Luxembourg's statistical institute, STATEC, announced that the annual inflation rate had fallen to 3.2% (down from 3.6% one month earlier).

In June 2023, the national consumer price index, calculated by STATEC, increased by 0.3% compared to the month before. STATEC attributed this increase mainly to the rebound in petroleum product prices and the rise in the prices of certain travel-related services. Prices excluding petroleum products increased by 0.2%.

After four months of decline, the prices of petroleum products went up by 1.8% in June compared to May 2023. At the pump, motorists had to pay 1.8% more for a full tank of petrol and 2.7% more for a full tank of diesel. Household heating oil bills increased by 4.6% over one month. Despite this slight recovery, petroleum product prices remained 17.4% lower than in June 2022.

In addition to petroleum products, travel-related services fuelled inflation in June 2023. With the start of the summer season and the approach of the school holidays, package holiday and airline ticket prices rose by 7.7% and 10.0%, respectively, compared to one month earlier.

Food prices continued their upward trend started in October 2021 and increased by another 0.2% over one month. Fresh fish (+3.2%), olive oil (+4.1%) and potatoes (+1.8%) recorded the highest monthly increases. Although the prices of fresh vegetables are falling (-1.4%), with a visible impact on the general index, their evolution over one year remained very marked (+23.3%), noted STATEC. In annual comparison, overall food prices were 11.4% higher.

In June 2023, few items in the index basket had a noticeable downward influence on the overall result. In terms of goods, plants and flowers (-3.7%), men's clothing (-0.4%) and small tools for the home and garden (-1.4%) recorded decreases. Regarding services, price reductions were recorded for crèches and daycare centres for children (-0.7%) as well as hotels, motels and hostels (-1.5%).

The annual inflation rate stood at 3.2%, down from 3.6% a month earlier. The underlying annual inflation rate lost 0.1 percentage points and stood at 4.7% in June 2023.