DENMARK / RankWire.AI / – As part of the broader economic trends in Europe, Denmark’s annual inflation rate decelerated to 1.7% in July from 1.9% in June, according to official data. The statistics from Statistics Denmark indicated that consumer prices rose by 1.3% compared to the previous month. Meanwhile, core inflation remained steady at 2.3%, unchanged from June. Notably, price increases in the hospitality sector, such as restaurants and hotels, continued to be significant factors influencing the overall index. Additionally, rental costs for holiday homes contributed notably during the summer travel season.
In July, the consumer price index was recorded at 102.92, with 2025 serving as the base year of 100. The combined effect of holiday home rentals and package holidays contributed 1.24 percentage points to the monthly increase, while food prices added a further 0.15 point. Conversely, categories like clothing, hotel accommodation, and footwear experienced declines, collectively reducing the monthly increase by 0.34 percentage points.
Rent expenses alone accounted for 0.55 percentage points of the annual inflation figure, making it the primary positive contributor. Holiday home rentals added 0.51 point, while fuel costs contributed 0.39 point. Electricity prices, on the other hand, lowered the annual inflation rate by 0.68 point. Food prices decreased the rate by an additional 0.26 point, and package holidays trimmed 0.06 point from the yearly reading. These movements in various categories collectively pushed headline inflation below its June level.
Service sector inflation continues to surpass goods
Prices for restaurants and hotels experienced an 8.1% increase from the previous year, marking the strongest growth among key consumer categories. Transport costs rose by 5.5%, while expenses related to information and communication increased by 4.6%. Education costs went up by 4.5%, and insurance and financial services gained 2.9%. Meanwhile, prices for food and nonalcoholic beverages declined by 1.6% over the same period. Household furnishings, equipment, and related services decreased by 1.1%.
In comparison to July 2025, service prices grew 3.8%, whereas goods prices fell 0.7%. The main driver of the 2.3% core inflation rate remained higher rents. The categories of housing, water, electricity, gas, and other fuels showed no significant change on an annual basis. Healthcare costs increased slightly by 0.7%, and prices for recreation, sport, and culture rose by 0.8%. These data highlight a noticeable disparity between the inflation trend in services and that in goods.
Harmonised inflation also shows a downward trend
Denmark’s harmonised index of consumer prices increased by 1.6% from July 2025, compared to 1.8% in June. This measure facilitates cross-country comparisons of inflation within the European Union. While Denmark’s national CPI includes owner-occupied housing based on estimated rental values, the harmonised measure excludes this component. In June, the harmonised inflation rate stood at 1.8%. Countries such as Sweden and the Czech Republic recorded 1.0% and 1.1%, respectively. Complete inflation data for the EU in July is not yet available.
The net price index grew by 2.6% year-over-year in July, a slight decrease from 2.7% in June. This index adjusts for indirect taxes and duties where possible and accounts for subsidies that reduce consumer prices. The harmonised index at constant tax rates increased by 2.4% from July 2025. Statistics Denmark calculates the CPI based on roughly 23,000 prices collected across about 1,600 shops, companies, and institutions. The agency has scheduled its next consumer price update for Sept. 10.