Inflation fell to 3.4% in February, marking only the fourth successive month than consumer prices have risen less than 5% on an annual basis, according to the Central Statistics Office (CSO).

Excluding energy and unprocessed food, the consumer price index rose 4.6% in the 12 months to February, with increases in the price of recreation & culture (+7%) and restaurants & hotels (+6.4%) driving up prices most.

The only divisions to record price declines from last February were clothing & footwear (-3.6%), and furnishings, household equipment & routine household maintenance (-0.2%).

The CSO figures show prices for food and non-alcoholic beverages rose 4% while housing, water, electricity, gas and other fuels prices rose 3.6% year-on-year, largely due to rising mortgage interest rates and rents.

While private rents (+5.3%) and local authority rents (+7.8%) both increased significantly, mortgage interest rates rose 27.7%.

The rising price of maintenance and home repairs (+2.9%) also contributed, although the increases were partially offset by falling electricity (-16.4%), gas (-12.9%) and solid fuels (-6.1%).

On a monthly basis, consumer prices grew by 1% from January, with the largest increases posted in clothing & footwear (+3.4%) and transport (+3%) while alcoholic beverages & tobacco (-0.7%) and communications (-0.3%) were the only divisions to fall.

Commenting on the CSO's National Average Prices study, also published on Thursday, statistician Anthony Dawson said: "There were price increases in February 2024 for a 2.5kg bag of potatoes (+42c) and Irish cheddar per kg (+22c), while there were decreases in the price of a pound of butter (-11c) and two litres of full fat milk (-9c) when compared with February 2023.” 

(Pic: Getty Images)