Free Irish Inflation Calculator

Inflation is an increase in the general level of prices of goods and services over time. When inflation rises, each euro you have buys fewer goods and services than before – this is called a decline in purchasing power. For example, if inflation is 3%, something that cost €100 last year would cost €103 this year. As a member of the Eurozone, Ireland's inflation is monitored by both the Central Statistics Office (CSO) and the European Central Bank (ECB), which aims to keep inflation at 2% over the medium term because stable inflation supports sustainable economic growth and helps households and businesses plan for the future.

The Consumer Price Index (CPI) is Ireland's official measure of inflation, published monthly by the Central Statistics Office (CSO). It tracks the percentage change in the price of a "basket" of goods and services that Irish households typically purchase. The current CPI series uses December 2023 as its base (December 2023 = 100). The CSO collects approximately 50,000 prices each month from shops, online retailers, and service providers across Ireland. The CPI basket contains 612 items grouped into 12 main categories (COICOP divisions) including Food, Housing, Transport, and Restaurants & Hotels.

The CPI basket includes 612 items across 12 main COICOP categories. The largest weights are: Restaurants & Hotels (reflecting Ireland's hospitality-heavy economy), Transport, Housing, Water, Electricity, Gas & Other Fuels, and Food & Non-Alcoholic Beverages. These weights reflect how much Irish households spend on each category – items households spend more on have larger weights. The CSO updates these weights annually using National Accounts Household Final Monetary Consumption Expenditure (HFMCE) data, with more detailed updates every five years based on the Household Budget Survey. The most recent major basket review was in December 2023, adding items like air fryers and non-alcoholic beer while removing items like digital cameras and landline telephones.

The European Central Bank aims to keep inflation at 2% over the medium term. This target was clarified in the ECB's 2021 strategy review, which moved from "below, but close to, 2%" to a symmetric 2% target. Being "symmetric" means the ECB considers deviations above and below 2% as equally undesirable. The ECB measures inflation using the Harmonised Index of Consumer Prices (HICP) for the Eurozone as a whole. This target provides a nominal anchor for inflation expectations across all 20 Eurozone member states, including Ireland, and guides the ECB's monetary policy decisions.

As of November 2025, the annual CPI inflation rate in Ireland was 3.2%, up from 2.9% in October. This is the highest rate since February 2024. The largest contributors to annual inflation were: Education (+8.9%) – reflecting third-level fee increases; Clothing & Footwear (+4.4%); Food & Non-Alcoholic Beverages (+4.3%); and Restaurants & Hotels (+3.6%). The only category showing a decline was Furnishings, Household Equipment & Routine Household Maintenance (-0.6%). Monthly, consumer prices fell by 0.2% between October and November 2025.

Ireland publishes two main inflation measures: the CPI (Consumer Price Index) and the HICP (Harmonised Index of Consumer Prices). The key difference is that the Irish CPI includes mortgage interest and local property tax, while the HICP excludes these (about 6.2% of the CPI basket). This means the CPI is more influenced by ECB interest rate changes – when rates rise, mortgage costs increase, pushing up the CPI but not the HICP. The HICP is used for EU comparisons and ECB monetary policy decisions, while the CPI is Ireland's national measure. In November 2025, CPI inflation was 3.2% while HICP inflation was 3.1%.

Inflation has three main causes: 1) Demand-pull inflation – when demand for goods/services exceeds supply, allowing businesses to raise prices. 2) Cost-push inflation – when production costs rise (e.g., wages, energy, raw materials), businesses pass these on to consumers. 3) Inflation expectations – if people expect prices to rise, they may demand higher wages or raise prices preemptively, making inflation self-fulfilling. Recent Irish inflation has been driven by strong food price growth (+4.3% in November 2025), education costs (+8.9%), and the hospitality sector (+3.6%), while transport costs have moderated. As a small, open economy, Ireland is also significantly affected by imported inflation from global supply chains and energy markets.

The ECB's primary tool is the deposit facility rate – the interest rate banks earn on overnight deposits with the Eurosystem. When inflation is too high, the ECB raises rates, making borrowing more expensive, reducing spending, and easing price pressures. When inflation is too low, the ECB lowers rates to encourage spending. The ECB cut rates eight times from June 2024 to June 2025 as inflation came under control, bringing the deposit rate down from 4% to 2.0%. In December 2025, the ECB held rates unchanged for the fourth consecutive meeting, with inflation near target at 2.1% for the Eurozone.

Housing, Water, Electricity, Gas & Other Fuels is one of the largest contributors to CPI inflation. In November 2025, this category rose +3.5% annually, driven by: Rents (+2.4%) – reflecting ongoing housing supply constraints; Electricity prices – following energy market volatility; Mortgage interest repayments – affected by ECB rate changes (included in CPI, not HICP); and Home heating oil. Rent makes up almost 7% of the CPI basket – a higher weighting than most individual items. Residential property prices rose by 7.3% in the 12 months to October 2025, putting the median dwelling price at €381,000.

Food & Non-Alcoholic Beverages inflation was +4.3% in November 2025 – about 1.5 times the overall inflation rate. Key price increases include: Irish cheddar (+€0.62/kg); Butter (+€0.55/lb); Milk (+€0.11/2L); and Bread (+€0.09/loaf). Food price inflation peaked at 5.1% in August 2025, the highest since December 2023. Rising food prices are driven by global commodity costs, supply chain pressures, and domestic factors including labour costs in food production and retail. However, the price of some items has fallen – potatoes dropped by 22c for a 2.5kg bag in the year to November 2025.

Core inflation excludes volatile items – typically energy and unprocessed food – to show the underlying trend in price changes. In Ireland, the CSO publishes "CPI excluding energy and unprocessed food" which was +3.1% in November 2025. This measure helps policymakers see through temporary price spikes (like oil price swings) to understand persistent inflation pressures. For Eurozone policy purposes, the ECB also monitors core HICP inflation. Services inflation, which is more domestically driven and tends to be "stickier," remained elevated at 4.0% in November 2025, contributing significantly to core inflation.

The CSO publishes the CPI monthly, typically in the second week following the reference month. Prices are collected over a period of more than one week each month – from the Monday before the second Tuesday through to and including the third Tuesday. About 30 price collectors gather around 10,000 prices directly from shops and outlets, another 10,000 prices are collected online, and about 20,000 prices come as transaction data directly from retailers. The HICP flash estimate is released earlier each month by Eurostat. This frequent publication schedule allows the ECB and government to monitor inflation trends closely for policy decisions.

Not exactly. The CPI measures price changes for a fixed basket of goods and services, while the cost of living relates to the amount of money needed to sustain a certain standard of living. For example, if beef prices rise, the CPI records this increase, but a cost-of-living measure might account for households switching to cheaper chicken. The CPI is an average covering all household types – from urban to rural, high to low income, different ages and situations. The CSO has a Household Finances Calculator and CPI Inflation Calculator to help people understand how inflation affects their personal circumstances.

As of December 2025, the ECB's key interest rates are: Deposit facility rate: 2.00%; Main refinancing rate: 2.15%; Marginal lending facility: 2.40%. The deposit rate is the primary policy rate that steers monetary policy. The ECB held rates unchanged at its December 2025 meeting for the fourth consecutive time, after cutting rates eight times between June 2024 and June 2025. The Governing Council projects headline inflation averaging 2.1% in 2025, 1.9% in 2026, and 2.0% in 2028, suggesting rates may remain stable through 2026 as inflation settles near target.

Ireland's highest recorded annual CPI inflation was 23.2% in 1981, following the second global oil shock. Inflation was above 15% from October 1979 until October 1982 and remained above 9% until April 1984. Another peak occurred at 20.9% in 1975 following the first oil crisis. More recently, inflation peaked at 9.2% in October 2022 during the post-pandemic energy and supply chain crisis – matching levels not seen since 1984. Since joining the Eurozone in 1999, Ireland has generally experienced low and stable inflation, averaging around 2% annually, though the 2022 surge was a notable exception.

Inflation expectations are what households, businesses, and financial markets believe will happen to prices in the future. They matter because expectations can become self-fulfilling. If workers expect high inflation, they'll demand higher wages; if businesses expect costs to rise, they'll raise prices preemptively. This "inflation psychology" can entrench high inflation. The ECB closely monitors expectations and aims to keep them "anchored" around the 2% target. Well-anchored expectations make it easier to control actual inflation. In Ireland, public sector pay negotiations and wage demands are often influenced by inflation expectations, making this a crucial factor for economic stability.

Inflation erodes the real value of money. If you have €10,000 in a savings account earning 2% interest but inflation is 3%, your money's purchasing power actually decreases by 1% per year. To maintain purchasing power, your investments need to earn a return above the inflation rate (a positive "real return"). In Q3 2025, Irish households saved about €1 in every €7 of disposable income – higher than the 2023-2024 average. With the ECB deposit rate at 2% and Irish inflation at 3.2%, savers currently face negative real returns on low-interest deposits, making it important to consider inflation-beating investments.

Social welfare payments in Ireland, including the State Pension, are adjusted through the annual Budget process rather than automatic indexation. The government considers factors including CPI inflation, wage growth, and fiscal conditions when setting payment rates. While there's no formal "inflation linking" like in some countries, recent budgets have included increases to help maintain purchasing power. The CPI is commonly used in industrial relations for wage negotiations and measuring if incomes keep pace with inflation. Some private pension schemes may have inflation-linked features, though many do not automatically adjust for price changes.

The ECB projects Eurozone headline inflation to average 2.1% in 2025, 1.9% in 2026, 1.8% in 2027, and 2.0% in 2028. Inflation has been revised up for 2026 mainly because services inflation is expected to decline more slowly than previously thought. For Ireland specifically, inflation has been more volatile due to domestic factors like housing costs and the hospitality sector. The ECB expects inflation to stabilise sustainably at 2% in the medium term, though services inflation (currently elevated at around 3.5% for the Eurozone) remains the key uncertainty in the forecast.

An inflation calculator helps you understand how prices have changed over time. You can use it to: 1) Calculate what something that cost €100 in 1990 would cost today (adjusting for inflation); 2) See how much your salary needs to increase to maintain the same purchasing power; 3) Understand the real value of historical prices. Ireland experienced an average inflation rate of about 4.9% between 1956 and 2026, meaning €100 in 1956 would be equivalent to approximately €2,825 today. The CSO provides an official CPI Inflation Calculator, and our free Ireland inflation calculator also uses official CSO data.