Is inflation finally subsiding in Austria?
Statistics Austria released a preliminary estimate showing that the inflation rate in May was 8.8 per cent, a decrease from the previous month's rate of 9.7 per cent. So are prices finally going to go down?
Tobias Thomas, the Director General of Statistics Austria, attributes this decline to lower fuel prices and less price pressure on food items.
“In May 2023, inflation in Austria has clearly lost momentum," he said. "According to a first estimate, inflation is expected to be at 8.8 percent after 9.7 percent in April. This is the lowest value since June 2022. The main reason for this decline is the uninterrupted downward trend in fuel prices. The upward trend in food prices continues to weaken."
A similar trend was observed in Germany, where the inflation rate for goods and services decreased from 7.2 percent in April to 6.1 percent in May. According to Eurostat, the inflation for the eurozone is estimated to be at 6.1 percent - down from the 7 percent registered in April.
READ ALSO: What will become more expensive in Austria in June?
However, despite the decline in May, inflation continues to burden many individuals significantly.
According to calculations by the Momentum Institute, an institute affiliated with the trade union, a single-person household needs to spend an average of €405 more per month this year to maintain their standard of living compared to 2021. The highest cost increases are observed in housing and energy, amounting to an additional €117 per month, followed by transport with €81, and food with an additional cost of €71 per month.
The challenge lies in the fact that the average increase in income of €260 does not fully offset these additional costs, resulting in a shortfall of €145 per month to maintain the standard of living experienced in 2021.
Final report by mid-June
From a large set of price data, Statistics Austria initially calculates the flash inflation estimate at the beginning of the following month. This estimate includes around 80 to 90 per cent of the prices required for the calculation. Typically, the inflation rate is accurately calculated with a deviation of only 0.1 percentage points.
READ ALSO: What is driving rising inflation in Austria and will the government act?
The final inflation data, including inflation rates for specific product groups, are released later in the month. In the case of May 2023, this will occur on June 16th.
Statistics Austria experts previously had an indication that a wave of inflation was approaching the country due to indices for import or producer prices, which provide insights a few months ahead of the CPI data.
However, the current indications are different, as producer prices only rose by 4.6 per cent in April. This suggests that the cost of living pressure on consumers will likely ease in the future.
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Tobias Thomas, the Director General of Statistics Austria, attributes this decline to lower fuel prices and less price pressure on food items.
“In May 2023, inflation in Austria has clearly lost momentum," he said. "According to a first estimate, inflation is expected to be at 8.8 percent after 9.7 percent in April. This is the lowest value since June 2022. The main reason for this decline is the uninterrupted downward trend in fuel prices. The upward trend in food prices continues to weaken."
A similar trend was observed in Germany, where the inflation rate for goods and services decreased from 7.2 percent in April to 6.1 percent in May. According to Eurostat, the inflation for the eurozone is estimated to be at 6.1 percent - down from the 7 percent registered in April.
READ ALSO: What will become more expensive in Austria in June?
However, despite the decline in May, inflation continues to burden many individuals significantly.
According to calculations by the Momentum Institute, an institute affiliated with the trade union, a single-person household needs to spend an average of €405 more per month this year to maintain their standard of living compared to 2021. The highest cost increases are observed in housing and energy, amounting to an additional €117 per month, followed by transport with €81, and food with an additional cost of €71 per month.
The challenge lies in the fact that the average increase in income of €260 does not fully offset these additional costs, resulting in a shortfall of €145 per month to maintain the standard of living experienced in 2021.
Final report by mid-June
From a large set of price data, Statistics Austria initially calculates the flash inflation estimate at the beginning of the following month. This estimate includes around 80 to 90 per cent of the prices required for the calculation. Typically, the inflation rate is accurately calculated with a deviation of only 0.1 percentage points.
READ ALSO: What is driving rising inflation in Austria and will the government act?
The final inflation data, including inflation rates for specific product groups, are released later in the month. In the case of May 2023, this will occur on June 16th.
Statistics Austria experts previously had an indication that a wave of inflation was approaching the country due to indices for import or producer prices, which provide insights a few months ahead of the CPI data.
However, the current indications are different, as producer prices only rose by 4.6 per cent in April. This suggests that the cost of living pressure on consumers will likely ease in the future.
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