Increased private school fees were largest contributor to June inflation

The annual rate of inflation as measured by the HICP remained at 0.2% in June 2021, with the largest upward impact measured in the education index due to increased private school fees.

Statistics provided by the National Statistics Office (NSO) show that the 12-month moving average rate for June stood at 0.3%. While the education index saw the largest upward impact at +0.38 percentage points, it was the restaurants and hotels index that contributed to the largest downward impact, at -0.93 percentage points.

Inflation has been on the decline over the past two years, reaching a peak in 2019 and a trough in 2021

The HICP, or Harmonised Index Consumer Prices, measures monthly price changes in the cost of purchasing a representative basked of consumer goods and services. 

As opposed to the Retail Price Index (RPI), which captures private households only, the HICP covers private households, institutional households, such as retirement homes, and foreign visitors to Malta.

Being the largest contributor to inflation in June, the individual annual inflation rate for education at a whopping 19.7%. The second highest rate was recorded in recreation and culture, with 3.5%.

On the other hand, the lowest annual inflation rates were registered in communication and transport, at -1.4% and -0.8% respectively.

According to the NSO, this upward impact in education is largely due to higher private school fees. The large impacts measured in the recreation and culture index and food and non-alcoholic beverages index were mainly on account of higher prices of vegetables and cinema tickets respectively.

The downward impacts, registered in restaurants, transport, and communication, reflect a lower contribution from accommodation services and lower prices of fuels and mobile phone services respectively.