The annual inflation rate in the Netherlands experienced a decline in June compared to the previous month. According to an initial estimate by Statistics Netherlands (CBS), inflation for this

month stood at 5.7%, down from 6.1% in May. The CBS implemented a new method for measuring and incorporating energy prices into the inflation rate, resulting in more accurate figures.

Under the old method, price developments were based on new energy contracts, while the new approach utilizes transaction data from energy suppliers, allowing for the inclusion of rates from longer-term energy contracts. This adjustment contributes to a more precise inflation measurement, as per the CBS.

The average price increase for supermarket products was 12.6% this month, slightly lower than May's 12.8%. Industrial goods experienced a price rise of 7.3%, compared to 8.9% in the previous month. The cost of services also increased, but at a slower pace of 5.7% compared to May's 6.1%.

Conversely, energy, including motor fuels, became 16.3% cheaper in June, following a price decrease of 18.5% in May.

To enable fair comparisons with other European countries, Statistics Netherlands also provided inflation figures according to the European method, which excludes housing rental prices. By this metric, the annual inflation rate was 6.4%, down from 6.8% in May.

Later today, the European statistics agency Eurostat will release inflation figures for the entire eurozone. Economists surveyed by Bloomberg anticipate a further cooling of inflation to 5.6% in June, after it reached 6.1% on an annual basis in May.

Given that inflation remains above the 2% target, it is expected that the European Central Bank (ECB) will continue to raise interest rates. ECB policymakers are scheduled to convene in July, and President Christine Lagarde indicated earlier this week that the fight against inflation is ongoing, with a likely increase of a quarter percentage point in interest rates next month. Photo by Ciell, Wikimedia commons.