Mary Upton (Dublin South Central, Labour)
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Question 44: To ask the Minister for Finance if he will estimate the average CPI and HICP measures for price volatility in 2009; and if he will make a statement on the matter. [12326/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Based on the latest information available at the end of last year my Department set out its expectation that the Consumer Price Index (CPI) would fall this year by -1.0% but that Harmonised Index of Consumer Prices (HICP) inflation would be slightly positive, at 1⁄2% for 2009 as a whole. These forecasts were contained in the Addendum to the Stability Programme Update published on 9th January this year.

Since then, inflation data for December, January and February have been released by the Central Statistics Office (CSO). In addition the ECB has cut interest rates by a full percentage point significantly impacting on the CPI index, while falls in regulated energy prices have also been announced. Furthermore, the weakening economic climate has led to a fall-off in price pressures across a range of sectors. My Department now expects CPI inflation to be lower then previously expected in 2009 and could average around -33⁄4% for the year as a whole. HICP inflation is expected to be negative too, averaging around -11⁄2% for 2009 as a whole.

Revised forecasts for inflation this year will be published with the Supplementary Budget on 7th April.