Luxembourg inflation set to be higher than Eurozone average
Prices in Luxembourg are expected to have risen by 3.5% in August this year compared to the same month in 2020 - above the Eurozone average - the European Union’s statistics bureau said on Tuesday.
According to a Eurostat inflation estimate, prices in the 19-country Eurozone are set to increase by an average of 3% in August, compared to the same period a year ago. The Eurozone includes Luxembourg, as well as neighbouring France, Belgium and Germany.
The price rises are mainly driven by an annual increase in energy prices by 15.4% as well as a 2.7% increase in industrial goods and a 2% rise in food, alcohol and tobacco, Eurostat said.
Estonia is predicted to have the highest inflation rate out of all countries in the Eurozone at 5%, followed by Lithuania at 4.9% and Belgium at 4.7%.
Consumers in the Grand Duchy haven't yet fully felt the higher prices that could result from economies around the world expanding in tandem with pandemic-related distress and disruptions, Luxembourg's statistics office, Statec, said earlier this month.
Worldwide prices for commodities – those basic goods used to make other products from food to cars to electronics – were more than 20% higher in early August than in late 2019, Statec said.
Changes in commodity prices can take more than a year before they reach consumers, and by that point they are somewhat absorbed across the various stages of production, Statec said.
Fuel prices in Luxembourg increased for the third month in a row in July, Statec said earlier this month. Rising petrol prices could cause inflation in the Grand Duchy to rise temporarily to nearly 3% by the end of 2021, Statec said previously. This year's overall inflation is forecast at 2.2%, but is expected to slow down next year to about 1.7%, the statistics agency said.