Home > Statistics > Consumer price index > 2009 > August > Inflation -0.7 per cent in August

Published: 14 September 2009

Inflation -0.7 per cent in August

The year-on-year change in consumer prices, i.e. inflation, calculated by Statistics Finland fell to -0.7 per cent in August. In July it was -0.6 per cent.

In August, consumer prices were brought down most from the year before by reductions in interest rates. Fallen prices of liquid fuels, telephone calls, owner-occupied dwellings and real estate, and used passenger cars also lowered inflation. By contrast, consumer prices were pushed up most by year-on-year increases in rents, restaurant and café prices, food prices, retail prices of alcoholic beverages and tobacco.

From July to August consumer prices rose by 0.3 per cent, primarily because clothing sales were coming to an end.

Each mid-month, Statistics Finland interviewers collect around 50,000 prices on 497 commodities from approximately 2,700 outlets for the Consumer Price Index. In addition, some 1,000 items of price data are gathered by centralised collection.

Finland's inflation indicators, August 2009

	Point figure	Year-on-year change	Month-on-month change
Consumer Price Index 2005=100	108.3	-0.7 %	0.3 %
Cost-of-living Index 1951:10=100	1 729
Harmonised Index of Consumer Prices 2005=100	108.9	1.3 %	0.4 %
Harmonised Consumer Price Index at Constant Taxes 2005=100	108.4	1.1 %	0.4 %

According to preliminary data, inflation in the EMU countries was -0.2 per cent in August

According to the preliminary data on the Harmonised Index of Consumer Prices, the rate of inflation in the EMU countries was -0.2 per cent in August. In July it was -0.7 per cent. The corresponding figure for Finland was 1.3 per cent in August.

The Harmonised Index of Consumer Prices does not include owner-occupancy, games of chance, interests on consumption and other credits or levies such as asset transfer tax and the vehicle tax. The consumption items included in the Harmonised Index of Consumer Prices as well the rules governing its compilation have been defined in EU regulations.

Eurostat's estimate of inflation in the EMU area is based on preliminary data from EMU Member States and on the price development of energy. Eurostat will publish detailed data on Harmonised Indices of Consumer Prices for August on 16 September.

The year-on-year change in the Harmonised Index of Consumer Prices at Constant Taxes was 1.1 per cent in August

The year-on-year change of the Harmonised Index of Consumer Prices was 1.3 per cent and that of the Index at Constant Taxes 1.1 per cent in August. From August last year, prices rose by 0.2 per cent due to changes in commodity taxes and by 1.1 per cent for other reasons. The month-on-month change of both Indices was 0.4 per cent in August. There were no changes in commodity taxes in August.

Statistics Finland started to publish a Harmonised Index of Consumer Prices at Constant Taxes in June 2009.In the Index at Constant Taxes the impact of value added tax and other commodity taxes on inflation has been eliminated by keeping the taxes constant relative to the Index base period. The Index measures market inflation, or the change in prices caused by reasons other than changes in commodity taxes. The price impact from changes in taxes is obtained by comparing developments in the Harmonised Index of Consumer Prices and the Index at Constant Taxes.

The price impacts from the changes in commodity taxation that took effect in 2009 were as follows: Motorcycle tax went up in April 2009, which pushed prices of motorcycles up by 3.1 per cent. Tobacco tax rose in January, which caused a price impact of two per cent on the prices of tobacco.

Alcohol tax also went up in January 2009. According to the Harmonised Index of Consumer Prices the price of retail alcohol rose by 4.75 per cent and that of restaurant alcohol by 1.31 per cent in the December 2008 to January 2009 period. According to the Index at Constant Taxes, the price of retail alcohol rose by 0.24 per cent and that of restaurant alcohol by 0.05 per cent over the same period (market inflation, or change in prices due to reasons other than changes in taxes). The price impact from changes in taxes is obtained as the difference in the development of the Harmonised index of Consumer Prices and the Index at Constant Taxes. The upward impact on prices from the risen alcohol tax was 4.5 per cent for retail alcohol and 1.3 per cent for restaurant alcohol.

Source: Consumer Price Index 2009, August. Statistics Finland

Inquiries: Mr Juhani Pekkarinen +358 9 1734 3476, Ms Christina Telasuo +358 9 1734 3472
Harmonised Index of Consumer Prices and Index of Consumer Prices at Constant Taxes: Christina Telasuo +358 9 1734 3472
khi@stat.fi

Director in charge: Mr Kari Molnar

Consumer price index 2009, August (pdf 241.4 kB)

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• Cost-of-living Index 1951:10=100 (14.9.2009)

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Last updated 14.9.2009