Energy price increases continue to drive inflation

Fuel prices have climbed by 12% in Luxembourg in just one month, the country's statistics bureau said on Wednesday, as energy bills soar to record levels across Europe. 

Inflation increased by 0.1% between December and January, with the rise driven by high fuel prices, Statec said, with oil used to heat homes increasing by just under 12% and gas prices by 30%.

Diesel and petrol went up 5% per litre between December and January and increased by 49% compared with January 2021, Statec added.  

Energy bills across Europe have hit record levels amid an unprecedented supply squeeze in recent months. 

Euro-area inflation unexpectedly accelerated to a record 5.1% earlier in February, with consumer prices jumping 5.1% from a year ago in January and up from 5% in December. 

Salaries in Luxembourg could be set to increase 2.5% in spring in response to growing inflation, Finance Minister Yuriko Backes said in parliament last week. While Backes predicted that wages will increase in coming months, she did not specify a date for the rise, but said workers would receive extra pay “in spring”

 Luxembourg’s consumer union, ULC, last month also asked lawmakers to “seriously consider an energy price freeze”, saying Luxembourg residents had seen a “drastic” increase in energy bills.

The Luxembourg Times has a new mobile app, download here! Get the Luxembourg Times delivered to your inbox twice a day. Sign up for your free newsletters here.