Inflation up again as fuel costs drive price hikes
Surging fuel prices sustained rising inflation in Luxembourg as overall prices shot up by 3.6% on average in October compared to a year ago, an uptick of 0.9 percentage points compared to the previous month's annual inflation rate, statistics agency Statec said on Monday.
Fuel prices rose by 10.5% between September and October, Statec found, with gas up by 17.7%, heating oil 12.4%, diesel 9.6% and regular petrol by 5.1%. Overall, fuel was almost 50% more expensive in October than at the same point last year, according to Statec.
The price for services went up by 0.5% from September, largely owed to the indexation of wages and pensions that was triggered last month by previous hikes in inflation, Statec said.
The cost of retirement homes rose by 2.2% while restaurant visits also went up by 0.8% compared to September. Other services that consumers needed to pay more for are haircuts, car maintenance and housekeeping, Statec added.
Whilst overall prices continued to go up, the cost for flat-rate holidays dropped by 3.9% and plane tickets plummeted by 21.8% compared to September.
Higher prices in recent months led to a wage and pension indexation of 2.5% last week which was added to salaries in October. Wages in Luxembourg are required to be topped up every time prices for consumer goods and services jump by more than a certain threshold - normally 2.5%. The measure last kicked in at the start of 2020, but it is unlikely to occur again in 2022, Statec said two weeks ago.
In July, amid rising prices across the eurozone, the European Central Bank adapted its inflation target to 2%, an upward shift from its previous model of "below but close to 2%".