- Belgium's inflation rate based on the European harmonised index of consumer prices (HICP) was running at 5.4% in February compared to 7.4% in January and 10.2% in December.
- Core inflation (inflation without energy and unprocessed food) stood at 8.5% in February compared to 8.2% in January.
- The inflation rate based on the consumer price index (CPI) for February stood at 6.6% compared to 8.1% in January.
- The sub-indices with the largest upward effect on inflation were bread and cereals, dairy products, meat, vegetables, restaurants and cafés, non-durable household goods (e.g. cleaning products), tobacco and confectionery.
- The sub-indices with the largest downward effect on inflation this month were gas, electricity, domestic heating oil, motor fuels and telecommunication.
- The harmonised index of consumer prices of February for the EU Member States will be published by Eurostat on 17 March.
The inflation rate based on the European harmonised index of consumer prices (HICP)[1] was running at 5.4% in February compared to 7.4% in January and 10.2% in December. The inflation rate based on the harmonised index of consumer prices at constant tax rates (HICP-CT)[2] was running at 6.8% in February, compared to 8.8% in January. The difference in inflation between the HICP and the HICP-CT is largely due to the temporary VAT reduction for electricity and gas. These price changes are not taken into account in the HICP-CT.
Core inflation, which does not take into account price evolutions of energy products and unprocessed food, was running at 8.5% in February, compared to 8.2% in January and 7.1% in December. Inflation without energy has gone up to 8.8% in February compared to 8.6% in January and 7.5% in December.
Inflation for food products stands at 19.4% this month, compared to 18.8% last month. This inflation has sharply increased sharply in recent months. In February 2022, it was still 4.1%. Inflation for oils, fish, dairy products, bread and cereals and meat has sharply increased in recent months. Inflation for oils amounted to 30.7% this month. In February last year, it was still 13.4%. For dairy products, inflation is now 30.4% compared to 4.3% in February 2022. Fish registers this month an inflation rate of 16.7%. In February last year, it was still 3.3%. For bread and cereals, it is 21.7% this month compared to 5.1% in February 2022. Inflation for meat amounts to 16.1% this month compared to 2.7% in February last year.
The inflation drop is mainly caused by the decline in inflation of energy products. The contribution of energy to inflation is now negative and amounts to -2.3%. Food products provide a contribution of 3.1%.
Electricity is now 16.0% less expensive than a year ago. Natural gas is 30.8% cheaper on an annual basis. The price of domestic heating oil has fallen by 13.2% compared to last year.
Inflation and effect on inflation for the 12 main groups
Based on the breakdown into 12 main groups, the highest inflation rate in February was measured for “Food and non-alcoholic beverages” (19.4%). The lowest inflation rate was measured for “Housing, water and energy” (-8.1%). The main group with the largest upward effect on inflation in February was “Food and non-alcoholic beverages” with an effect of 2.6 percentage points. The largest downward effect was measured for “Housing, water and energy” with -3.3 percentage points.
Inflation[3] and effect[4] on inflation for the overall HICP and 12 main groups
| Product group | Weight (‰) | Inflation on annual basis (%) | Effect on inflation (percentage point) | ||||||
|---|---|---|---|---|---|---|---|---|---|
| HICP | HICP-CT | ||||||||
| Dec/22 | Jan/23 | Feb/23 | Feb/23 | Dec/22 | Jan/23 | Feb/23 | |||
| 0 | Total expenditure | 1.000 | 10.2 | 7.4 | 5.4 | 6.8 | |||
| 1 | Food and non-alcoholic beverages | 155.4 | 15.4 | 18.8 | 19.4 | 19.4 | 1.1 | 2.1 | 2.6 |
| 2 | Alcoholic beverages and tobacco | 47.4 | 7.7 | 8.4 | 8.9 | 6.7 | -0.1 | 0.0 | 0.2 |
| 3 | Clothing and footwear | 60.1 | 7.0 | 8.2 | 5.3 | 5.3 | -0.2 | 0.0 | 0.0 |
| 4 | Housing, water and energy | 201.3 | 22.6 | 2.3 | -8.1 | -2.0 | 2.6 | -1.3 | -3.3 |
| 5 | Interior decoration and household appliances | 72.9 | 6.5 | 7.2 | 7.5 | 7.5 | -0.3 | 0.0 | 0.2 |
| 6 | Health | 70.6 | 2.7 | 4.8 | 4.9 | 4.9 | -0.6 | -0.2 | -0.1 |
| 7 | Transport | 105.9 | 7.3 | 6.4 | 5.9 | 7.2 | -0.4 | -0.1 | 0.1 |
| 8 | Communication | 32.2 | -0.3 | 2.0 | 2.4 | 2.4 | -0.4 | -0.2 | -0.1 |
| 9 | Recreation and culture | 85.8 | 5.3 | 5.1 | 5.2 | 5.2 | -0.4 | -0.2 | 0.0 |
| 10 | Education | 5.4 | 1.6 | 1.6 | 1.6 | 1.6 | 0.0 | 0.0 | 0.0 |
| 11 | Hotels, cafés and restaurants | 82.7 | 7.3 | 8.1 | 8.3 | 8.3 | -0.2 | 0.1 | 0.3 |
| 12 | Various goods and services | 80.4 | 5.4 | 6.7 | 7.0 | 7.0 | -0.4 | -0.1 | 0.1 |
Inflation according to specific aggregates
The overall HICP can be broken down into five specific aggregates which together form the total expenditure.
Inflation for energy products decreased compared to the previous month. It was running at -14.7% in February compared to 0.9% in January and 33.0% in December. Prices decreased on average by 13.6% compared to the previous month. The average inflation rate of this aggregate for the last twelve months is 46.8%.
Inflation of processed food rose from 16.3% in January to 16.9% in February. In December it was 13.5%. Compared to the previous month, prices rose by an average of 1.1%. The average inflation rate for the last twelve months is 10.5%.
Inflation for unprocessed food (fruit, vegetables, meat and fish) amounts to 16.6% in February compared to 16.1% in January and 13.5% in December. Prices increased on average by 2.9% compared to January. The average inflation rate of this aggregate for the last twelve months is 9.9%.
Inflation for non-energy industrial goods was running at 6.7% in February, remaining stable compared to January. Prices increased on average by 5.7 % compared to the previous month.
Inflation for services (including rents) went up from 5.5% in January to 5.9% this month. The average inflation rate of this aggregate for the last twelve months is 4.3%.
Core inflation (inflation without energy and unprocessed food) stands at 8.5% in February. This is an increase compared to 8.2% in January. The average core inflation over the last 12 months amounts to 5.8%. Prices of this subaggregate increased by 2.4% compared to the previous month.
Inflation according to specific aggregates
| Specific aggregates | Weight (‰) | Inflation on annual basis (%) | 12-month average (%) | Monthly change | ||
|---|---|---|---|---|---|---|
| Dec/22 | Jan/23 | Feb/23 | Feb/23 | Feb/23 | ||
| Total expenditure | 1.000,0 | 10.2 | 7.4 | 5.4 | 9.9 | 0.3 |
| Fuels and energy sources | 146,8 | 33.0 | 0.9 | -14.7 | 46.8 | -13.6 |
| Processed food products | 163,3 | 13.5 | 16.3 | 16.9 | 10.5 | 1.1 |
| Unprocessed food | 39,5 | 13.5 | 16.1 | 16.6 | 9.9 | 2.9 |
| Non-energy industrial goods | 248,9 | 6.4 | 6.7 | 6.7 | 4.8 | 5.7 |
| Services | 401,5 | 4.8 | 5.5 | 5.9 | 4.3 | 0.9 |
| HICP without energy and unprocessed food (core inflation) | 813,7 | 7.1 | 8.2 | 8.5 | 5.8 | 2.4 |
Effect of sub-indices on inflation
The largest upward effect on inflation was caused by bread and cereals with an impact of 0.50 percentage points. Dairy products provided a positive impact of 0.47 percentage points. Meat provided an upward effect of 0.45 percentage points. Vegetables provided an effect of 0.26 percentage points. Restaurants and cafés had a positive impact of 0.20 percentage points. Non-durable household goods (e.g. cleaning products) provided an effect of 0.19 percentage points. Tobacco and confectionery had both an effect of 0.11 percentage points.
Sub-indices with the largest upward effect on inflation
| Sub-index | Weight (‰) | Effect on inflation (percentage point) | |
|---|---|---|---|
| 2023 | Feb/23 | ||
| 01.1.1 | Bread and cereals | 30.4 | 0.50 |
| 01.1.4 | Dairy products | 19.2 | 0.47 |
| 01.1.2 | Meat | 40.5 | 0.45 |
| 01.1.7 | Vegetables | 14.5 | 0.26 |
| 11.1.1 | Restaurants and cafés | 71.0 | 0.20 |
| 05.6.1 | Non-durable household goods | 11.3 | 0.19 |
| 02.2.0 | Tobacco | 30.5 | 0.11 |
| 01.1.8 | Confectionery | 11.0 | 0.11 |
The largest downward effect on inflation came from natural gas with an impact of -1.52 percentage points. Electricity had a negative impact of -1.08 percentage points. Domestic heating oil has a negative impact of -0.31 percentage points. Motor fuels and telecommunication had a downward effect of -0.17 and -0.15 percentage points respectively.
Sub-indices with the largest downward effect on inflation
| Sub-index | Weight (‰) | Effect on inflation (percentage point) | |
|---|---|---|---|
| 2023 | Feb/23 | ||
| 04.5.2 | Gas | 45.9 | -1.52 |
| 04.5.1 | Electricity | 48.9 | -1.08 |
| 04.5.3 | Domestic heating oil | 17.3 | -0.31 |
| 07.2.2 | Motor fuels | 33.9 | -0.17 |
| 08.3.0 | Telecommunication | 29.4 | -0.15 |
Comparison with neighbouring countries
Since the final HICP of the neighbouring countries will not be published until later, comparisons can only be made based on the first HICP flash estimate for February. This inflation amounted to 5.5% in February in Belgium. The Netherlands registered an inflation rate of 8.9% in February. This is a slight increase compared to 8.4% in January. In France, inflation was 7.2% in February, slightly up from the 7.0% registered in January. The first HICP flash estimate for February in Germany was 9.3%, a slight increase compared to January, when the inflation stood at 9.2%.
Since the HICP at constant tax rates for February are not yet published by Eurostat, January is the most recent month to use as a basis for comparison. Belgium's inflation rate based on the HICP-CT stood at 8.8% in January, down from a rate of 11.7% in December. In January, this inflation rate in Germany was 9.5%. This is a slight decrease compared to December, when inflation was 9.9%. Inflation in France has slightly increased from 7.2% in December to 7.5% in January. In the Netherlands, inflation decreased to 8.5% in January. In December, this inflation rate was 13.8%.
[1] In addition to the national consumer price index (CPI), Statbel also calculates a European harmonised consumer price index (Harmonised Index of Consumer Prices, HICP). The HICP is used to compare inflation rates in the EU Member States. To this end, the applied expenditure approach and methods have been coordinated as much as possible and laid down in European regulations. The results of the CPI and HICP are not the same. This is mainly due to a different weighting and composition of the basket of goods and services on which these indices are based.
The HICP is also used by the European Central Bank in its monetary policy. Additionally, the HICP is used to determine to what extent a Member State meets the inflation criteria set in the Treaty on European Union.
Differences between the HICP and the current CPI are:
- The weighting of the basket of goods and services in the HICP is mainly based on the national accounts. At lower detailed levels the Household Budget Survey is used. The CPI mostly uses the Household Budget Survey at all levels.
- The reference population of the HICP consists of private households (including tourists in Belgium) and institutional households (e.g. retirement homes and nursing homes). In the CPI, this population currently consists of private households with a reference person under a maximum age.
- The HICP uses the concept of domestic expenditure: expenditure in Belgium by the reference population. The CPI uses the concept of national expenditure: expenditure by the reference population irrespective of the location.
- Seasonal adjustment is not applied in the HICP, but is applied in the CPI to travels abroad and stays in holiday villages.
- Sales periods have been neutralised in the CPI , but are included in the same month in the HICP.
- Current prices for domestic heating oil are used in the HICP calculation. A weighted 12-month average is applied in the CPI calculation.
[2] The HICP-CT is calculated in the same way as the regular HICP, but the prices in this index are calculated based on constant tax rates. This index therefore reflects the theoretically potential effect of changes in indirect tax rates (such as VAT or excise duties) on measured inflation. However, this is a theoretical effect, since it presupposes that tax changes are immediately and entirely reflected in prices paid by consumers.
[3] Inflation on annual basis measures the price changes between the current month and the same month of the year before. A 12-month average compares the average HICP of the last 12 months with the average of the previous 12 months. A monthly change compares the price levels of the last two months.
[4] The effect on inflation shows the changes on the inflation rate by including the sub-index in the HICP. The effect not only takes the weight of the sub-index into account, but it also takes into account whether the sub-index inflation is higher or lower than that of the total expenditure (overall HICP).