Inflation rate drops to 4%, reaching lowest level since January 2022

Malta inflation rate dropped to four per cent in August, its lowest level since January 2022, according to the National Statistics Office.

Last month, the Retail Price Index (RPI) stood at 4.7 per cent.

The highest annual inflation rates in August 2023 were registered in food – including takeaways and restaurant (9.3 per cent) and housing (8.7 per cent).

On the other hand, the lowest annual inflation rates were registered in transport and communication (-2.7 per cent) and clothing and footwear (-1.1 per cent).

Food also had the largest impact on annual inflation (+ two percent). This comes as no surprise given its large weighting, making up over 21 per cent of all household inflation – meaning that changes in the prices of foodstuffs over have a significant impact on the inflation rate.

The second and third largest impacts were measured in the housing Index (+0.69 percentage points) and the other goods and services Index (+0.53 percentage points).

Malta measures inflation in two ways, the Retail Price Index and the Harmonised Consumer Price Index (HCPI). The RPI is a local measure, and is used to calculated the Cost of Living Adjustment, which is expected to reach €13 per week next week. The HCPI is a standard measure across the EU, allowing for comparison between countries.