New figures from the Central Statistics Office show that the inflation growth rate eased last month.
The Consumer Price Index shows that prices rose by 2.8% during the 12 months to the end of December.
That compares to an annual increase of 3.2% in the year to November, while the figure is also lower than the 2.9% recorded in October.
The rate of inflation across the euro zone also eased last month, hitting the European Central Bank’s 2% target, down from 2.1% in the year to November.
The most significant increases in the 12 months to December 2025 were seen in Education, which increased by 8.9%, and Clothing and Footwear, which rose by 5.7%.
The CSO said the annual change in Education reflected a rise in costs associated with third-level education which came into effect from October 2025.
Furnishings, Household Equipment & Routine Household Maintenance was the only division to show a decline when compared with December 2024, down by 0.4%.
Today’s figures show that beef and veal prices were up by 22.4% compared to 23.9% the previous month, while the price of lamb was up by 18.9% compared to 17.9% in November.
The price of milk increased by 2.2%, down from a rise of 4.8% the previous month. Butter prices were 8.2% higher, down from 10.2% in November, while the price of chocolate was up by 12.3%.
Meanwhile, energy products were 2.4% more expensive, compared to a 3.3% rise in November, while transport inflation also fell from 2.5% in November to 0.2% last month.
The CSO also today published its National Average Prices for selected goods and services for December today.
There were price increases in the 12 months to December for Irish cheddar per kg (up 68 cent), a pound of butter (up 54 cent), 2 litres of full fat milk (up six cent), and an 800g loaf of white sliced pan (up five cent).
There were decreases in the price of a 2.5kg bag of potatoes ( down 24 cent), spaghetti per 500g (down two cent), and an 800g loaf of brown sliced pan (down a cent) when compared with December 2024.
Elsewhere last month, the national average price of a pint of stout in licensed premises was €6.09, up 27 cents in the year, while a pint of lager was €6.51, up 24 cents compared with December 2024.
Commenting on today’s CSO figures, Thomas Pugh, economist at accounting and advisory firm RSM Ireland, said the easing of the increase in food prices “should help households feel a little less under pressure despite food inflation remaining elevated.”
“Furthermore, the evidence suggests that food inflation has an outsized effect on inflation expectations, so lower food inflation will reduce the risk of any knock-on effects from employees bargaining for bigger pay rises,” the economist said.
Mr Pugh said transport inflation fell sharply to 0.2% from 2.6%, “as volatile airfares inflation dropped to -4.8% from -0.7% previously.”
“That was helped further by fuel inflation slowing to 1.2% from 2.8% as more favourable base effects helped to drag down energy inflation,” he added.
Looking ahead, he said the data published by the CSO today confirmed RSM Ireland’s view that November was the peak in the recent rise in inflation.
“We should now see inflation back on a downward path as lower wholesale food prices help to dampen inflation. However, we still expect inflation to remain close to 2.5% next year as strong domestic demand and potential infrastructure shortages put upward pressure on domestically generated inflation,” he added.
Mr Pugh said auto-enrolment pensions and a 4.8% rise in the minimum wage “will keep inflationary pressures in sectors such as hospitality persistent as firms grapple with increased costs.”
“All told, we think today’s drop in inflation confirms that November was the peak, but we think inflation is likely to remain above 2.5% for most of the year instead of dropping back to 2%,” he said.
The December CPI showed that insurance costs were up by 6.3%, driven by an 8.3% rise in the price of health insurance and a 1.4% increase in car insurance.
On a monthly basis, the CSO report showed that prices rose by 0.5% between November and December.
