Consumer price index of March 2021

• Inflation increases from 0.46 % to 0.89 % in March.
• The consumer price index this month increases by 0.30 points or 0.27 %.
• Inflation based on the health index has increased to 0.55 % from 0.47 %.
• The smoothed health index stood at 108.09 points in March.
• Inflation for food products and non-alcoholic beverages remains negative and currently stands at -0.58 %.
• The most significant price increases in March were registered for motor fuels, fruit, electricity, confectionery, tobacco and bread and cereals. However, bundled telecommunication services, alcoholic beverages, flowers and plants, fish and seafood and vegetables have had a decreasing effect on the index.
• The current measures due to the COVID-19 had an impact on the calculation of the index. More information is available here. In practice, this means that for the month of March there is an increasing effect on the index for travels abroad due to the carry forward of prices with last year’s seasonal correction factor. For hotel rooms, there is a decreasing effect on the index for the same reason.

The consumer price index amounts to 110.51 points in March 2021. It has increased by 0.30 points over the month. Inflation has gone up to 0.89 % from 0.46 %. The health index gained 0.17 points and is now at 110.56 points. Inflation based on the health index has increased to 0.55 % from 0.47 %. The most significant price increases were registered for motor fuels, fruit, electricity, confectionery, tobacco and bread and cereals. However, bundled telecommunication services, alcoholic beverages, flowers and plants, fish and seafood and vegetables have had a decreasing effect on the index.

The consumer price index has risen by 0.30 points or 0.27 % in March 2021 and is now running at 110.51 points, compared to 110.21 points in February 2021 (2013=100). The health index has gained 0.17 points to 110.56 points in March, compared to 110.39 points in February. The smoothed health index stood at 108.09 points in March. The next central index for public service and social benefits is set at 109.34 points.

Products with the largest upward effect in March were motor fuels, fruit, electricity, confectionery, travels abroad and city trips, tobacco and bread and cereals. However, bundled telecommunication services, alcoholic beverages, hotel rooms, flowers and plants, fish and seafood and vegetables have had a decreasing effect on the index. The most important trends this month are:

(*) consequence of the carry forward of prices with a seasonal correction factor

Motor fuels became on average 4.8 % more expensive. Prices for fruit have increased on average by 7.0 %. Electricity is on average 1.8 % more expensive than last month. Prices of sugar, jam and chocolate have gone up on average by 3.6 %. Tobacco has become on average 3.0 % more expensive. Prices of bread and cereals have increased on average by 0.7 %.

Prices for bundled telecommunication services have decreased on average by 2.0 %. Prices of alcoholic beverages have decreased on average by 2.5 % compared to the previous month. Flowers and plants have become 6.1 % cheaper. Prices of fish and seafood have gone down by on average 2.3 % compared to last month. Vegetables have been on average 1.0 % less expensive compared to the previous month.

Note about inflation for commonly purchased products

The table below shows the inflation of a number of commonly purchased product groups. For almost all commonly purchased products, inflation has been sharply decreasing since the last quarter of last year. This decrease in inflation is due to the fact that the effect of the price decreases in the second semester 2019 has faded away. See the analysis on ‘Measuring inflation during the coronavirus crisis’ for a discussion on this effect.  Since the previous month, the inflation for most product groups has even been negative, which means that prices are lower than a year ago.

Also when compared to March 2020 based on price recordings carried out at the beginning of the coronavirus crisis, prices have been lower for a while. This is also the case this month. For example, prices for food products are currently on average 0.5 % lower than in March 2020. Compared to April 2020, when the temporary ban on discounts was in force, prices are still lower. For example, food products are 2.2 % cheaper compared to April 2020, and cleaning and maintenance products are even 4.1 % less expensive.

Note about overall inflation

Inflation now stands at 0.89 % compared to 0.46 % last month and 0.26 % in January. Inflation based on the health index amounted to 0.55 % this month compared to 0.47 % in February and 0.57 % in January. Inflation without energy went down to 0.76 % in March, compared to 0.87 % in February and 1.10 % in January. Core inflation, which does not take into account price evolutions of energy products and unprocessed food, stood at 0.96 % in March, compared to 1.01 % in February and 1.15 % in January.

Energy inflation is now running at 2.27 %, compared to -3.60 % last month and -7.85 % in January. Electricity is now 4.4 % more expensive than a year ago. Natural gas is 7.1 % more expensive on an annual basis. Prices for domestic heating oil, calculated based on a smoothed 12-month moving average, have declined by 30.3 % over a year. Motor fuels are 9.7 % more expensive than last year. Inflation for services has declined to 1.16 % from 1.23 %. Inflation for rents amounted to 2.13 % in February and has decreased to 1.81 % in March.

Some products and services that rose sharply in price compared to March last year are:

Some products and services that dropped sharply in price compared to March last yeare are:

The main group with the largest upward effect^[i] on inflation in March was "Transport" with an effect of 0.44 percentage points. The largest downward effect was measured for “Food and non-alcoholic beverages” with
-0.32 percentage points.

The main group with the largest contribution^[ii] to inflation is "Transport" with 0.50 percentage points. The lowest contribution to inflation was registered by "Food and non-alcoholic beverages", with -0.10 percentage points.

The first inflation estimate according to the European harmonised index of consumer prices (HICP flash estimate) for Belgium amounts to 1.6% in March.

^[i] The contribution to inflation of a specific product group shows how much of the change in the total expenditure is due to the price variation of this product group.

^[ii] The effect on inflation shows the changes on the inflation rate by including this product group in the CPI calculation. The effect not only takes the weight of the product group into account, but it also takes into account whether the product group inflation is higher or lower than that of the total expenditure (overall HICP).