Annual inflation at highest level since January 2024

A considerable jump in the cost of energy drove consumer prices 4.1% higher in the year to September, according to latest figures from the Central Statistics Office (CSO).

The September annual increase compared with a 3.7% rise in the 12 months to August, and was the highest rate of inflation since January 2024.

The CSO figures show that energy products – which includes electricity, gas and other fuels – were up by 15.3% in the year to September.

These increases follow a jump in the cost of oil as a result of the conflict in the Middle East.

Since March the cost to households for electricity, gas, and home-heating oil has risen significantly.

A jump in mortgage interest rates of over 10% has also also contributed to higher consumer prices. Costs across education (+8.9%) and transport (+7.5%) have also added to higher prices.

According to the CSO, food prices rose by just 0.4% in the past year, but experts have warned that food-price inflation is expected to surge next year.

More detailed figures on fuel and home heating oil from the CSO today show that the price of diesel rose by 5.4% and petrol increased by 4.8% in September from August and were up by 22% and 14% respectively since the same month last year.

This marked the largest annual increase in the price of diesel since November 2022 when prices increased by 24.7%.

It was also the steepest annual increase in petrol prices since May 2024 when prices rose by 14.5% compared with May 2023.

The CSO noted that the national average price in September for diesel was €2.06 a litre while petrol was €1.96 a litre.

Meanwhile, the price of home heating oil rose by 7.2% in the month between August and September and soared by 58.6% in the 12 months to September 2026.

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Commenting on today’s figures, Dermot Daly, EY Ireland Consumer Products and Retail Leader, said the fact that all spending categories have now recorded annual price increases for three consecutive months highlights the breadth of the cost pressures facing Irish households and businesses.

He said the increases in housing and energy-related costs, transport and education are particularly noteworthy as these are essential expenses that households have little scope to avoid.

“Rising fuel, energy and transport costs also create additional pressure for businesses as they balance higher operating costs with intense competition,” Mr Daly said.

He said that while consumers have shown resilience – household spending is likely to grow 2.5% after inflation this year – many will have to prioritise essential purchases while taking a more considered approach to discretionary spending.

“As we move closer to the important Christmas trading period, retailers will be hoping that consumer spending remains resilient despite ongoing cost pressures,” he added.