Bernard Durkan (Kildare North, Fine Gael)
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Question 215: To ask the Tánaiste and Minister for Finance the extent to which he expects inflationary tendencies here to affect the economy in 2008; and if he will make a statement on the matter. [24046/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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Annual inflation as measured by the Consumer Price Index (CPI) was 4.6 per cent in the year to September. A better measure of inflation is the Harmonised Index of Consumer Prices (HICP) which excludes, amongst other things, mortgage interest. Including the impact of mortgage rate increases in the CPI not only masks the underlying inflation rate, but also highlights the short term impact of interest rate increases which are designed to bring down inflation. The increase in the HICP in the year to September was 2.9 per cent.

My Department will publish its Pre-Budget Outlook later this week, which will include an inflation forecast for 2008 based on up-to-date data. It will also include a general assessment of the outlook for the economy as a whole, including inflation, in 2008.