Irish inflation drops to 8.2% amid cost-of-living squeeze

Tomas Doherty

Irish inflation dropped slightly to 8.2 per cent in September, down from an annual increase of 8.7 per cent in the previous month, according to the Central Statistics Office (CSO).

This is the twelfth straight month where the annual increase for the CSO's Consumer Price Index has been at least 5 per cent, triggering the worst cost-of-living squeeze in decades.

Household energy costs were the main drivers of the change with the cost of home heating oil up by almost 84 per cent, electricity up by 36 per cent and gas prices by 53 per cent.

While the price of both diesel and petrol in September were lower than in August, diesel prices rose by over 32 per cent in the year and petrol was up by over 15 per cent. .

Soaring prices could drag the economy into a technical recession — defined as two consecutive quarters of economic contraction — in the coming quarters, the Central Bank warned in its latest quarterly economic bulletin last week, as households and businesses struggle to keep pace with inflation.

Irish inflation is expected to peak at 8 per cent this year before easing to 6.3 per cent next year and 2.8 per cent in 2024, the bank said.