Annual Inflation Drops to 0.8%

Luxembourg's national statistical institute, STATEC, has reported that the annual inflation rate dropped from 1.0% to 0.8% over one month.

In November 2024, the national consumer price index, calculated by STATEC, fell by 0.5% compared to the previous month. STATEC attributed this decrease to the sharp decline in travel costs, associated with a drop in the price of gas.

For the fourth consecutive month, petroleum product prices followed a downward trend. Town gas was down by 7.2% compared to October. On the one hand, petrol prices at the pump were down by 1.2% over one month. On the other hand, diesel prices increased by 1.0%. The price of heating oil was up by 0.3%. Compared to November 2023, petroleum product prices were 12.6% lower.

On the decline side, the overall result was also influenced by a seasonal variation related to package holidays. Travellers paid 12.6% less for their stays than one month earlier. Airline ticket prices decreased by an average of 14.5% compared to October 2024. Compared to November 2023, airfare prices were 3.9% lower, while package holidays prices were 11.1% higher. The evolution of services was also impacted by the 3.2% drop in nursery and "maisons relais" prices compared to the previous month. Price increases for services were noted for car maintenance and repair (+0.5%) and mobile phone services (+2.2%). The services aggregate increased by 2.6% over one year.

Food prices decreased by 0.5% compared to October 2024. The largest price decreases were observed for potatoes (-2.8%), rice (-3.3%) and poultry meat (-1.3%). The price of mineral waters (-2.1%) and spirits and liqueurs (-5.7%) also dropped. However, consumers had to pay more in November for frozen fish (+2.9%), baby food (+3.1%) and pasta and couscous (+2.6%). Over one year, food prices as a whole were up by 0.6%, non-alcoholic beverage prices increased by 1.0% and alcoholic beverage prices were up by 1.6%.

Price increases with a visible impact on the monthly rate were observed for women's shoes (+4.7%), bicycles (+3.6%) and automobiles (+0.2%). Price decreases were recorded for cameras (-7.6%), games and hobbies (-7.0%) and household appliances (-1.5%).

The annual inflation rate thus stood at 0.8% in November 2024, down from 1.0% one month earlier. The underlying annual inflation rate lost 0.2 points and stood at 1.6% in November. The general index for the month in question expressed in base 100 in 2015 stood at 122.32 points.

STATEC recalled that the next wage indexation will be triggered when the value of 1013.46 of the half-yearly average of the index linked to the base 1.1.1948 is reached. However, this decreased from 1012.15 to 1010.97 points in November. The low inflation observed in recent months has thus contributed to the delay of the next index tranche.