A gradual decline in inflation has been noted since last October. Based on the data received, it is obvious that various services regularly update their forecasts. This is what Statec is doing. The agency now predicts inflation at 3.9% in 2023, while next year the figure should fall to 2.5%.
The Luxembourg government has agreed with unions and employers on several wage indexations in response to rising prices caused by the energy crisis and last year's drought. The next one should take place in September, but it may not happen.
The truth is that the increase in employees' wages is based on a certain inflation rate. So if it is below 4.1% in August, the new indexation will be postponed to October.
For a long time, fuel prices have been a major contributor to the decline in inflation figures due to the negative base effect. Food and services are the biggest contributors to growth.