Inflation has hit a three-year high at 4.3% due to high energy prices

THE RATE OF inflation is the highest it’s been since December 2023, according to the latest figures available from the Central Statistics Office (CSO). 

Consumer prices rose by an average of 4.3% between October 2025 and 2026 – the highest rate of inflation since December 2023 when it stood at 4.6%.

Higher energy prices drove the increase in inflation.

CSO statistician Anthony Dawson said higher prices for home heating oil, electricity and gas, as well as increased costs for rents and mortgage interest repayments, caused the 10.7% increase in costs relating to housing, water, electricity, gas and other fuels.

Meanwhile, transport costs increased by 9%, which Dawson said is down to elevated petrol and diesel prices, as well as higher prices for airfares.

Sinn Féin finance spokesperson Pearse Doherty said that the figures show that the government “completely short-changed workers and families”. 

“Prices are rising far above what was forecast just a few short weeks ago when Fianna Fáil, Fine Gael, and the independents brought forward a budget that short-changed workers and families,” he said in a statement. 

Doherty called on the government to take action to support households, including reintroducing energy credits, banning rent increases and removing USC on the first €40,000 earned. 

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A spokesperson for the Department of Finance said: “Budget 2027 is built around a personal income tax package worth some €1.3 billion, ensuring that work is rewarded, and workers do not find themselves paying more in tax because their wages have risen.”

“The Budget also took further action on energy prices, extending the reduced tax on fuel, cutting carbon tax on kerosene and natural gas and delaying the legislated increase on other fuels. These measures will ensure that there will be no increase in any form of tax on fuel during the winter period.”

They said measures announced on budget day “build upon the significant support Government has already made available over the course of the year to assist with the cost of living”.

“Government has the capacity to respond in a swift and agile manner to the energy price shock because of a track record of sound fiscal management, which has returned the public finances to surplus,” they added.

Rossa White, chief economist at EY Ireland, said he expects inflation impacted by energy costs to slow.

“Inflation for goods should ease over the next months – barring another geopolitical shock, given the recent trend in energy prices,” White said. 

He also warned that today’s proposed public sector pay deal, which provides for increases of 10.75% from 1 July 2026 to 31 March 2029 for over 420,000 public servants, may be above inflation rates next year. 

“Today’s public sector pay deal is most relevant for the impact of service prices on overall inflation,” he said.

“The annualised increase in pay out to the end of March 2029 works out at 3.8%. That is above average inflation over the last decade of 2.4%, or the Euro Area target of 2%. We also expect inflation to trend a bit lower over the next year to average 3% in 2027.”

“Services price inflation has been high for over five years. The risk is that pay deals above inflation risk keeping it there – like the mid-2000s.”