DENMARK / RankWire.AI / – Official data revealed that Denmark’s inflation rate for the year slowed to 1.7% in July from 1.9% in June. Statistics Denmark reported that consumer prices experienced a 1.3% increase from the previous month. The core inflation rate remained steady at 2.3%, matching the figure recorded in June. Notably, the rise in prices within the restaurant and hotel sectors continued to significantly influence the overall index, with holiday home rentals also playing a major role during the busy summer travel season.
The consumer price index reached 102.92 in July, based on a 2025 index of 100. The combined effect of holiday home rentals and package holidays contributed an additional 1.24 percentage points to the monthly increase, while food prices added 0.15 point. Conversely, categories such as clothing, hotel accommodation, and footwear experienced price declines that collectively reduced the monthly inflation by 0.34 percentage points.
Housing costs, particularly rent, had the largest impact, adding 0.55 percentage points to the annual inflation figure. Holiday home rentals contributed 0.51 point, with fuel prices adding 0.39 point. Electricity costs, on the other hand, helped lower the annual inflation rate by 0.68 point. Food expenses decreased the rate by an additional 0.26 point, and package holidays slightly trimmed 0.06 point from the yearly figure. These shifts in various categories collectively pushed the headline inflation below its June level.
Service sector prices continue to surpass goods
Prices for restaurants and hotels increased by 8.1% compared to the same period last year, marking the strongest growth among major consumer categories. Transport costs rose 5.5%, while expenses related to information and communication climbed 4.6%. Education prices grew by 4.5%, and insurance along with financial services saw a 2.9% rise. Meanwhile, prices for food and nonalcoholic beverages declined by 1.6%, and household furnishings, equipment, and associated services fell 1.1% over the same timeframe.
Compared to July 2025, service prices increased by 3.8%, whereas the prices for goods decreased by 0.7%. The primary driver behind the 2.3% core inflation rate remains the rising rent costs. The prices of housing, water, electricity, gas, and other fuels showed no significant change on an annual basis. Health-related expenses increased marginally by 0.7%, while recreation, sports, and cultural expenses rose by 0.8%. The data clearly demonstrates a notable disparity between the inflation experienced in services and the shifts in goods prices.
EU-wide inflation measurement also exhibits decline
Denmark’s harmonised index of consumer prices rose 1.6% from July 2025, down from 1.8% in June. This indicator facilitates cross-country inflation comparisons within the European Union. Unlike Denmark’s national CPI, which factors in owner-occupied housing through estimated rental values, the harmonised measure excludes that component. As of June, Denmark’s harmonised inflation rate was 1.8%. In comparison, Sweden recorded a rate of 1.0%, and the Czech Republic reported 1.1%. Complete inflation data for the entire EU for July has not yet been released.
The net price index increased by 2.6% year-over-year in July, slightly down from 2.7% in June. This measure accounts for indirect taxes and duties where applicable, while also including subsidies that help reduce consumer costs. The harmonised index at constant tax rates rose 2.4% from July 2025. Statistics Denmark compiles the CPI based on roughly 23,000 prices across approximately 1,600 shops, companies, and institutions. The agency has scheduled its next consumer price update for Sept. 10.