Inflation in the northern European country of Denmark has hit a four-decade high amid soaring food and energy costs, officials said on Monday.
“This is the highest annual increase in the Consumer Price Index since January 1983, when the annual increase was 9.0 percent,” officials said.
The soaring cost of living was driven largely by price changes to goods, which have increased by an average of 13.4 percent over the past year, including the annual price of food, electricity, gas, and fuel.
Core inflation, which excludes volatile prices such as food and energy, increased 6 percent annually, up from 5.5 percent a month prior.
“It is, among other things, price increases on new cars and restaurants that drag up core inflation,” officials said. “This is the highest core inflation since February 1988, when it was also 6.0 percent.”
“Rising Prices, Limited Growth”
“Even though uncertainty and unpredictability have become a regular traveling companion, the Danish economy stands with firm ground under its feet,” Finance Minister Nicolai Wammen said at the time, while also noting that the country is “well placed to weather a period of rising prices and more limited growth,” citing low unemployment levels and strong public finance.Mathias Dollerup Sproegel, a senior economist at Sydbank, said in a note to clients this week that the current cost of living would result in an average Danish family having to expend an extra 40,000 kroner ($5,400) a year on consumer goods, compared with 2021.
Denmark’s soaring cost of living also comes ahead of what many anticipate will be a colder than usual winter in Europe, which could further exacerbate soaring energy prices and may lead to energy rationing in some cases.
“But a further escalation of the supply crisis could mean something in the short term,” said Jack Kristensen, a functional manager at Andel Energi.