DENMARK / RankWire.AI / – Official figures reveal that Denmark’s annual inflation rate decreased to 1.7% in July from 1.9% in June. According to Statistics Denmark, the consumer price index rose by 1.3% compared to June. The core inflation rate held steady at 2.3%, showing no change from the previous month. Notably, restaurants and hotels contributed most significantly to July’s inflation, driven mainly by increased holiday home rental prices within that sector.
The consumer price index for July reached 102.92, with 2025 designated as the base year with an index value of 100. Of the monthly increase, holiday home rentals and package holidays together contributed 1.24 percentage points. Food prices contributed an additional 0.15 percentage point, while a decrease in clothing, hotel accommodation, and footwear prices collectively reduced the monthly rate by 0.34 percentage point.
Housing costs, particularly rent, had the largest positive impact on the annual inflation rate, adding 0.55 percentage point. Holiday home rentals contributed another 0.51 point, and fuel prices added 0.39 point. Conversely, electricity costs reduced the annual rate by 0.68 point. Food prices decreased the rate by 0.26 point, and package holidays subtracted 0.06 point, resulting in headline inflation falling below June’s 1.9% figure.
Restaurants and transportation spearhead yearly inflation increases
Prices in the restaurant and hotel sector surged by 8.1% from July 2025, marking the strongest growth among the primary CPI components. Transport prices rose 5.5%, while information and communication costs increased by 4.6%. Education expenses went up by 4.5%, and insurance as well as financial services saw a 2.9% rise. In contrast, prices for food and nonalcoholic beverages dropped by 1.6%. Household furnishings, equipment, and related services declined by 1.1%.
The gap between goods and services prices remained broad in July. While goods prices fell by 0.7% compared to the previous year, services prices increased by 3.8%. The primary factor behind the steady core inflation rate of 2.3% was the rise in rents. Overall, housing, water, electricity, gas, and other fuels experienced no significant change from July 2025. Health-related expenses grew by 0.7%, and expenses for recreation, sport, and culture increased by 0.8%.
EU harmonised inflation drops to 1.6%
In July, Denmark’s harmonised index of consumer prices increased by 1.6% year-over-year, down from 1.8% in June. The European Union harmonised measure allows for cross-country inflation comparison. Denmark’s national CPI factors in owner-occupied housing via estimated rental values, whereas the HICP excludes this element. EU-wide inflation in June was 2.9%. Sweden recorded a 1.0% increase, the Czech Republic saw 1.1%, and Denmark’s was 1.8%. Full EU data for July was not yet published at the time of Denmark’s release.
Denmark’s net price index grew by 2.6% in July compared to the previous year, slightly down from 2.7% in June. This index adjusts for indirect taxes and duties where applicable, while including subsidies that reduce overall prices. The HICP at constant tax rates increased by 2.4% from July 2025. Statistics Denmark compiles the CPI based on approximately 23,000 prices collected across about 1,600 shops, companies, and institutions. The next update on consumer prices is scheduled for Sept. 10.