Inflation four times higher than euro area's
The cost of living in Malta last month fell slightly over August, according to statistics issued by Eurostat yesterday. However, the local inflation rate in the past 12 months was more than four times the average of the euro area, making Malta the...
The cost of living in Malta last month fell slightly over August, according to statistics issued by Eurostat yesterday.
However, the local inflation rate in the past 12 months was more than four times the average of the euro area, making Malta the member state with the highest annual inflation rate in the 16-member eurozone.
According to the EU's statistical arm, inflation in September eased by 0.2 per cent over the previous month, an improvement when compared to the euro area where inflation remained stable at 0.0 per cent. But this slight improvement is still not enough to compensate for the high level of inflation the country has been seen over the past year - a year of unprecedented global recession.
Eurostat said that although the current economic recession has had a massive impact on the cost of living in Europe, with prices in free fall and an annual inflation of just 0.7 per cent, a record low, in Malta this has not been the case.
Although in a decreasing trend, annual inflation in Malta has remained very high when compared to the rest of the euro area, reaching 3.2 per cent last month. This will have a rebound effect on the economy later on this year as according to the Maltese cost of living adjustment mechanism (COLA), the government and private employers will have to fork out quite a high weekly compensation in 2010.
On a general level, Eurostat said that in September, the lowest annual rates in the 27 EU member states were observed in Ireland (-3.0 per cent), Portugal (-1.8 per cent) and Estonia (-1.7 per cent), and the highest in Romania (4.9 per cent), Hungary (4.8 per cent) and Poland (4.0 per cent).
Compared with August, annual inflation fell in 23 member states, including Malta, remained stable in one and rose in three.
The lowest 12-month averages up to September 2009 were registered in Ireland (-0.5 per cent), Portugal (-0.3 per cent) and Luxembourg (0.2 per cent), and the highest in Latvia (6.5 per cent), Lithuania and Romania (both 6.2 per cent).