Inflation in Netherlands down again

9th January 2009, Comments 0 comments

Inflation in December has fallen for the fourth consecutive month to 1.9 percent.

THE NETHERLANDS – De Volkskrant reports that inflation in the Netherlands has fallen to 1.9 percent in December for the fourth consecutive month, 0.4 percent less than in November.

Statistics Netherlands, or CBS, says the main cause of the reduced inflation is the recent drop in oil prices. In December, car fuels were 17 percent cheaper compared to the same period one year ago.

All in all, at 2.5 percent for the whole of 2008, inflation in the Netherlands is higher than the 1.6 percent Euro-zone average.

CBS Economist Michiel Vergeer attributed it to two reasons – fixed energy prices and tax hikes.

In many countries, energy prices are directly linked to the price of crude oil. However, in the Netherlands, energy prices are fixed every six months which is now working to the Dutch disadvantage, said Vergeer.

The series of recently introduced tax hikes, including diesel fuel and tobacco duties, and a new tax on plane tickets also contribute to the higher-than-average inflation.

[Radio Netherlands / Expatica]

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