Rise in cost of living in Republic sits at just 1.3%
Compared to Northern Ireland, our nearest neighbour has had an "easy ride" when it comes to inflation, Richard Ramsey, Ulster Bank's chief economist in Northern Ireland, said yesterday.
The Republic's rate of inflation currently stands at just 1.3%, well below the 5.2% UK CPI inflation reported yesterday and mirroring a trend which has been in place for a number of years.
Since the credit crunch began in August 2007, Mr Ramsey said the cumulative CPI rise in all UK items stands at 15.5% while the same measure across the border has risen by only 0.7% over the same period.
One of the reasons behind this is the disparity in the price movement of food and non-alcoholic beverages, which have fallen by 0.7% in the period from August 2007 to September 2011 in the Republic compared to a rise of 28% in Northern Ireland.
"Aggressive price reductions, in the context of relatively fat profit margins, alongside a strong euro have limited inflationary pressures in the RoI," he said.
Meanwhile, inflation in hotels and restaurants is up 14.7% in the UK over the same period compared to a fall of 2% in the Republic. Health is the only category when consumer spending has risen by more in the Republic at 13.3% compared to 13.1%
And consumers in Northern Ireland are suffering more than those in the UK.
Mr Ramsey said that while CPI has stood at 15.5%, wages in the UK have risen by just 8.8%, but such a figure is more than likely a little generous for workers in Northern Ireland.