According to figures released recently by Statistics Iceland (SI), the consumer price index (CPI) rose 0.94% month-on-month in March, Headline inflation now measures 6.7%, up from 6.2% in February. It is Iceland’s highest inflation measurement since May 2010. The CPI excluding housing rose by 0.82% during the month, and twelve-month inflation thus measured was 4.6%.
The March measurement was below our forecast. We had projected that the CPI would increase by 1.1% MoM, whereas forecasts as a whole provided for rises in the 0.9-1.2% range. The main difference between our forecast and SI’s measurements lies in imputed rent, which rose more than we had expected. On the other hand, airfares remained flat, whereas we had forecast an increase.