DENMARK / RankWire.AI / – Official data revealed that Denmark’s inflation rate for the year slowed to 1.7% in July from 1.9% in June. Statistics Denmark reported that consumer prices increased by 1.3% compared to the previous month. The core inflation rate remained steady at 2.3%, matching the June figure. Price increases in the hospitality sector, especially restaurants and hotels, continued to significantly influence the overall index. Additionally, rentals of holiday homes contributed notably during the peak travel season.
The consumer price index reached 102.92 in July, with 2025 designated as the base year of 100. The rise was partly driven by holiday home rentals and package holidays, which together added 1.24 percentage points to the monthly increase. Food costs contributed an additional 0.15 point. Conversely, categories such as clothing, hotel accommodations, and footwear experienced declines, collectively reducing the monthly increase by 0.34 percentage point.
The largest contributor to the annual inflation rate was rent, adding 0.55 percentage points. Holiday home rentals added 0.51 point, while fuel costs contributed 0.39 point. Electricity prices decreased the inflation rate by 0.68 point, and food prices lowered it by another 0.26 point. Package holidays slightly reduced the yearly figure by 0.06 point. These shifts in category prices collectively brought the headline inflation below its June level.
Service sector prices outpace goods
Prices for restaurants and hotels increased by 8.1% from the previous year, representing the strongest growth among major consumer categories. Transport costs rose 5.5%, while expenses related to information and communication climbed 4.6%. Education prices went up 4.5%, and insurance along with financial services gained 2.9%. Meanwhile, food and nonalcoholic beverage prices declined by 1.6%, and household furnishings, equipment, and related services fell 1.1%.
Compared to July 2025, service prices increased by 3.8%, whereas the prices for goods fell by 0.7%. The main driver behind the 2.3% core inflation rate was higher rent costs. Overall, housing, water, electricity, gas, and other fuels showed no significant change over the year. Prices for health services rose 0.7%, and costs for recreation, sport, and culture increased by 0.8%. The data clearly illustrates a notable divergence between inflation in services and the decrease in goods prices.
Decline in the harmonised inflation indicator
Denmark’s harmonised consumer price index increased by 1.6% from July 2025, down from 1.8% in June. This index facilitates comparisons of inflation rates across European Union nations. The national CPI incorporates owner-occupied housing costs through estimated rental values, whereas the harmonised measure omits this component. In June, Denmark’s harmonised inflation rate was 1.8%. Other EU countries such as Sweden recorded 1.0%, and the Czech Republic reported 1.1%. Complete inflation data for the EU in July had not yet been published.
The net price index saw a 2.6% increase year-over-year in July, slightly below the 2.7% rise observed in June. This index excludes indirect taxes and duties where possible and accounts for subsidies that help lower consumer prices. The harmonised index at constant tax rates rose by 2.4% from July 2025. Statistics Denmark calculates the CPI based on roughly 23,000 prices gathered from about 1,600 retail outlets, companies, and institutions. The agency has scheduled its next consumer price update for September 10.