• The interest rates for household’s mortgages rose and contributed with 2.9 percentage points to the annual inflation rate according to the CPI.
•  Food prices fell by 0.7 percent from July to August.
• Electricity prices were 36.8 percent lower in August compared to August last year, which contributed to a decrease in the inflation rate.
• Prices of package holidays and passenger transport by air fell in August.
• The annual inflation rate according to CPIF excluding energy decreased from 8.0 percent in July to 7.2 percent in August.

Food prices fell in August

The CPI increased by 0.1 percent from July to August. In the corresponding period a year ago, prices increased by 1.8 percent.

Food prices fell by 0.7 percent in August. In addition, there were seasonally normal price declines for package holidays, international flights, and car rentals.

Fuel prices and interest rates of household’s mortgages increased from July to August. Clothing had a seasonally normal price increase after the summer sales.

There were also higher prices for congestion fees, which is an effect of a new methodology that account for days that are free of charge.

For more information:

Changes in CPI in 2023 (scb.se, pdf)

The table below shows one-month percent changes and contributions to the CPI based on the goods and services that had the greatest impact on the CPI in August 2023. The results are presented by COICOP category. COICOP refers to the United Nations classification of household consumption expenditure.

Inflation rate lower in August

The inflation rate according to CPI, that is, the change in CPI from the same month of the previous year, was 7.5 percent in August 2023. This is a decrease from July when the inflation rate was 9.3 percent.

Lower electricity prices were the main reason which made the inflation rate to slow down. Prices were 36.8 percent lower this year compared to August 2022.

The inflation rate of August was particularly affected by the increased interest rates of household’s mortgages which contributed 2.9 percent to the total CPI. In addition, rented apartment fees rose by 4.0 percent compared to August 2022.

There have been several price increases for goods and services in recreation and culture, where package holidays and other leisure goods have had a major impact. Recreation and culture are now one of the main groups that have the greatest impact on the inflation rate.

Despite many declines in the prices of food products, these prices were 9.2 percent higher on a yearly basis. Above all there were price increases within sugar, jam, honey, chocolate, confectionery, and ice cream. Further contributions to the inflation rate came from higher prices of restaurant and hotel visits, transport, miscellaneous goods and services, furnishings, and household good, and clothing.

The inflation rate according to the CPIF, which unlike CPI is not affected by changes in mortgage interest rates, was 4.7 percent in August. The corresponding rate for July was 6.4 percent.

The inflation rate calculated excluding energy products (CPIF-XE) was 7.2 percent in August, which is a decrease compared to July when it was 6.4 percent.

Different measures of inflation

Statistics Sweden calculates different inflation measures for different purposes. The CPIF is the Riksbank’s target variable, while the CPI is the measure used for purposes of compensation. The CPIF includes the same goods and services as the CPI. The difference between the CPI and the CPIF is that the latter measure holds interest rates for household’s mortgages constant. As a consequence thereof, the effect of changed interest rates for household’s mortgages is only captured by the CPI and not the CPIF.

Additional to the CPI and the CPIF, the HICP is also calculated. The HICP is a harmonized measure of inflation used within the EU cooperation. Another index that is calculated each month is CPIF-XE (the CPIF excluding energy products) which is often used as a measure of underlying inflation.