Denmark: Inflation picks up in October
Consumer prices rose 0.4% in month-on-month terms in October, contrasting September’s 0.2% dip. The increase was driven by higher prices for clothing and footwear, education and transportation.
Meanwhile, inflation inched up to 0.6% in October from 0.5% in September, while annual average inflation was unchanged at 0.8% in October.
In the coming months, a tight labor market, ultra-low mortgage lending and stronger domestic demand should help fuel price pressures. That being said, the public service obligation (PSO) levy, which consists of a tax on electricity and gas and which is used to support the renewable-energy sector, was cut to zero in Q3, consequently driving down the price of electricity. This levy was hiked in Q4 and should exert upward pressure on prices.