DENMARK / RankWire.AI / – In July, official data revealed that Denmark’s inflation rate for the year slowed to 1.7% from 1.9% in June. According to Statistics Denmark, consumer prices saw an increase of 1.3% compared to the previous month. The core inflation rate remained steady at 2.3%, the same as in June. The index was notably influenced by rising costs in the hospitality sector, with restaurants and hotels contributing significantly. Additionally, holiday home rentals played a substantial role during the summer travel season.
The consumer price index reached 102.92 in July, with 2025 designated 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 another 0.15 point. Conversely, categories such as clothing, hotel accommodations, and footwear experienced price declines, collectively reducing the monthly figure by 0.34 percentage point.
Rent was the largest positive driver, adding 0.55 percentage point to the annual inflation rate. Holiday home rentals and fuel followed, increasing inflation by 0.51 and 0.39 points respectively. Electricity prices, however, had a deflationary effect, lowering the annual rate by 0.68 point. Food costs contributed a further 0.26 point reduction, and package holidays trimmed an additional 0.06 point from the yearly figure. Collectively, these shifts caused the headline inflation rate to dip below its June level.
Services continue to grow faster than goods
Prices for restaurants and hotels rose by 8.1% compared to the previous year, marking the strongest increase among major consumer categories. Transport costs grew 5.5%, while expenses related to information and communication increased by 4.6%. The prices of education services went up 4.5%, with insurance and financial services gaining 2.9%. Meanwhile, food and nonalcoholic beverages experienced a 1.6% decline, and household furnishings, equipment, and related services decreased by 1.1% over the same period.
Overall, services prices climbed 3.8% compared to July 2025, whereas the prices of goods fell by 0.7%. The dominant factor behind the 2.3% core inflation rate was the persistent rise in housing rents. Prices for housing, water, electricity, gas, and other fuels showed no significant yearly change. Health-related costs increased by 0.7%, and prices for recreation, sports, and culture rose by 0.8%. The data clearly illustrate the divergence between service inflation and goods pricing trends.
Harmonised Consumer Price Index Also Shows Decline
In July, Denmark’s harmonised index of consumer prices increased by 1.6% from July 2025, a slowdown from the 1.8% recorded in June. This measure facilitates inflation comparisons across European Union member states. Denmark’s national CPI factors in owner-occupied housing via estimated rental values, which the harmonised measure excludes. In June, the harmonised inflation rate stood at 1.8%. Sweden’s rate was 1.0%, and the Czech Republic reported 1.1%. Complete inflation data for the EU in July has yet to be published.
The net price index grew by 2.6% year-over-year in July, a slight decrease from 2.7% in June. This index excludes indirect taxes and duties where applicable, incorporating subsidies that reduce consumer prices. The harmonised index at constant tax rates rose 2.4% from July 2025. Statistics Denmark compiles the CPI based on roughly 23,000 prices collected across around 1,600 shops, companies, and institutions. The agency has scheduled its next consumer price release for September 10.