Low inflation and high consumer confidence

Low prices keep inflation down while consumers predict that the economy is improving

Inflation is rising at a much slower rate in Denmark than in the rest of Europe according to the latest figures from Statistics Denmark.

While inflation rose by 1.5 percent in the last 12 months in the EU, inflation only rose by 0.1 percent in Denmark over the same period.

According to BRF Kredit chief economist Ulrikke Ekelund, a drop in the price of food and petrol contributed to the low inflation.

Low prices, low inflation
“The good news is that our money goes further when we are shopping and that improves our competitive ability given that Danish products become cheaper compared to those in the EU,” Ekelund told Ritzau.

Danish inflation was also lower than in Japan, 0.75 percent, and in the US, 1.5 percent, over the past 12 months.

READ MORE: Car ownership rises as prices plummet

In the EU, only Bulgaria, Greece, Lithuania and Ireland had lower inflation. Estonia saw the greatest inflation, with 3.6 percent.

The consumer confidence indicator dropped slightly between August and September, but is much higher than at the start of the year.

Optimism over economy
According to Statistics Denmark, the high rating shows that Danes are optimistic about both their finances and the Danish economy.

“Consumers think that Denmark’s economic situation is better today than it was a year ago [and that] both their family’s and Denmark’s economic situation will be better in a year than it is today,” Statistics Denmark wrote in a press release.

The statistics agency adds that consumers also expect unemployment to drop over the next 12 months.