Irish prices hit a 40-year high of 8.2 pc in May, according to EU flash estimates.
His figure was slightly above the eurozone average and follows a year-on-year price increase of 7.3 percent in April, measured by the European Union’s harmonized index of consumer prices.
Prices in the 19-member currency sector rose to a new record 8.1 per cent in May, up from 7.4 per cent in April, accounting for more than a third of the rise in energy prices.
Food prices rose 7.5 percent, while core inflation, which excludes volatile food and energy costs, rose 3.8 percent, nearly double the EU’s 2 percent target.
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There are no details on the breakdown of Irish inflation figures. The Central Statistics Office will publish its estimates later in June.
The last time the consumer price index was above 8 percent was in the third quarter of 1984, when the index was published every three months.
The news comes after French, German and Spanish inflation hit this week’s highs, increasing pressure on the European Central Bank to raise interest rates more aggressively this summer.
European Central Bank chief economist Philippe Lane told the Spanish newspaper this week that interest rates would gradually rise “in units of 25 basis points” in July and September.
He added that central bankers “have to make the case for moving forward more strongly than this”.
The ECB will gather for its next rate-setting meeting in the Netherlands on 9 June, although the first rate hike is not expected until July.
Despite rising prices, the Irish economy is expected to grow further this year and next, growing at nearly twice the rate of the rest of the European Union, while unemployment remains at record lows.
The European Commission expects growth to rise to 5.4 percent this year – lower than the 6.4 percent projected by the government in April – and 4.4 percent in 2023.
The International Monetary Fund is more upbeat, predicting a 6 percent expansion in GDP this year – which includes activities from multinationals – and 5 pc in 2023.
The state budget watchdog, the Fiscal Council, said this week that if it raises wages and prices further, the growth could be hit by high inflation.
In its latest financial assessment report, it said the government was pausing funds to offset the rising cost of living for public sector workers, pensioners and welfare recipients, and increased taxes or costs in other sectors from 2023. will need to be cut.
Irish independent It was reported last week that new childcare subsidies and cuts in public transport fares are expected to be the cornerstones of a new living-for-living package for next year’s budget.
Budget 2023 will also aim to lower healthcare costs at both the hospital and pharmacy levels, and is determined to bring down third-tier education costs.