Highest Inflation In 16 Months

Inflation in Iceland is currently higher than it has been in 16 months. Twelve-month inflation now stands at 3.5%, a report from RÚV revealed this morning. It has not been higher than this since May last year, when it was 3.6%.

According to a new survey by Statistics Iceland, the prices of furniture, household appliances and related products has risen by 4%. If household wares were not included inflation would be higher, standing at 3.9%.

From December last year to June this year inflation rose from 1.7% to 2.6%. July saw it rise to 3%: it has now increased in three consecutive measurements.

The news comes in the wake of a macroeconomic forecast from Íslandsbanki, which predicts that while growth is sure to decrease this year, the promise of a coronavirus vaccine could see the economy bounce back by spring 2021.

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