Life in the Netherlands was 8.8 percent more expensive in the past month compared to May last year. That means prices rose less sharply than in April, when they rose 9.6 percent compared to the same month a year earlier. This is mainly because energy prices rose less sharply than in recent months, reports the CBS Thursday.
What is inflation?
- Inflation is the degree to which life becomes more expensive; think of the prices of everything from your groceries to your utility bill, from your drink at a cafe to your new car.
- Every month, the Central Bureau of Statistics (CBS) publishes an average figure of how much prices have risen in the previous month.
Since the sharp price increases, energy has had a major impact on inflation figures. Since the end of the corona crisis, gas and electricity have become much more expensive every month. The price increase is not over yet, but it is slowing down. In May, energy was 105 percent more expensive than a year earlier, in April it was still 136 percent.
Gasoline prices, on the other hand, went up more. Petrol was 23.8 percent more expensive last month, compared to 20.1 percent in April. A liter of petrol cost an average of 2.19 euros in May. On Wednesday, the petrol price broke a record and came to 2,505 euros per liter. Refueling is slightly cheaper on Thursday: 2,501 euros per liter.
Food also became more expensive, partly because Ukraine is an important supplier of raw materials. Those deliveries are now being delayed due to the war with Russia, which is driving up the price. Meat became 13.9 percent more expensive, all food items together rose 9.1 percent.
Interest rate hike can reduce inflation
It remains to be seen whether the less sharp rise in energy prices will continue in the coming months. Since the beginning of this month, the Netherlands no longer receives gas from the Russian Gazprom. This will remain so until at least the end of September.
Importer GasTerra has purchased gas from other parties, but does not want to say anything about the price of that gas. If that is more expensive, this will probably also be reflected in the inflation figures in the coming months.
On the other hand, the European Central Bank (ECB) will decide on interest rates on Thursday. It will most likely go up. That in turn can push inflation down, because the higher the interest rate, the more people earn on their savings and the longer they leave it in their account.