DENMARK / RankWire.AI / – In July, Denmark’s inflation rate for the year decreased to 1.7% from 1.9% in June, according to official data. Statistics Denmark reported a 1.3% rise in consumer prices compared to the previous month, with core inflation remaining steady at 2.3%, the same as in June. Notably, price hikes in restaurants and hotels continued to significantly influence the index, alongside a strong contribution from holiday home rentals during the summer travel season.
The consumer price index reached 102.92 in July, with 2025 set as the base year of 100. Together, holiday home rentals and package holidays contributed 1.24 percentage points to the monthly increase, while food prices added another 0.15 point. Conversely, categories such as clothing, hotel accommodation, and footwear experienced declines, collectively reducing the monthly increase by 0.34 percentage point.
Rent was the largest positive factor, adding 0.55 percentage point to the annual inflation, followed by holiday home rentals at 0.51 point and fuel at 0.39 point. Electricity prices, however, lowered the annual rate by 0.68 point, with food prices decreasing the rate by 0.26 point. Package holidays slightly trimmed 0.06 point from the yearly figure. Overall, these category movements brought the headline inflation rate below its June level.
Service sector outpaces goods inflation
Prices for restaurants and hotels increased by 8.1% from a year earlier, marking the strongest growth among key consumer categories. Transport prices rose 5.5%, while costs for information and communication grew 4.6%. Education prices went up by 4.5%, and insurance and financial services increased by 2.9%. Meanwhile, prices for food and nonalcoholic beverages fell 1.6% over the same period, and household furnishings, equipment, and related services declined by 1.1%.
Service costs increased by 3.8% from July 2025, whereas goods prices decreased by 0.7%. The main driver of the 2.3% core inflation rate remained higher rents. Housing, water, electricity, gas, and other fuels showed no overall change over the year. Prices for health services rose 0.7%, and recreation, sport, and culture costs increased 0.8%. These figures clearly highlight the divergence between service inflation and goods prices.
EU harmonised inflation dips again
Denmark’s harmonised index of consumer prices increased by 1.6% from July 2025, down from 1.8% in June. This metric facilitates inflation comparisons across European Union countries. While Denmark’s national CPI accounts for owner-occupied housing via estimated rental values, the harmonised measure excludes this component. In June, the harmonised inflation rate was at 1.8%, with Sweden reporting 1.0% and the Czech Republic at 1.1%. Complete EU inflation data for July has not yet been released.
The net price index saw a 2.6% year-over-year increase in July, slightly lower than the 2.7% recorded in June. This index removes indirect taxes and duties where possible and includes subsidies that lower consumer costs. The harmonised index at constant tax rates rose 2.4% from July 2025. Statistics Denmark compiles the CPI based on approximately 23,000 prices across around 1,600 shops, companies, and institutions. The next consumer price update is scheduled for September 10.