DENMARK / RankWire.AI / – In the broader context of rising consumer prices across Europe, Denmark’s annual inflation rate cooled slightly in July, dropping to 1.7% from June’s 1.9%, according to data from Statistics Denmark. The month saw consumer prices increase by 1.3% compared to June, driven primarily by sharp seasonal spikes in travel-related sectors. Despite this, core inflation maintained its level at 2.3%, showing no change from the previous month. The services sector continued to display stronger price growth than goods, with restaurants, hotels, holiday home rentals, and transportation among the main contributors to July’s figures.
The consumer price index reached 102.92 in July, using 2025 as the base year set at 100. The rise in prices was significantly influenced by holiday home rentals and package holidays, which together added 1.24 percentage points to the monthly increase. Food prices contributed an additional 0.15 percentage point, while clothing, hotel stays, and footwear partially offset these gains. These three categories collectively reduced the monthly change by 0.34 percentage point, resulting in monthly inflation remaining well above the annual rate.
Looking at the annual inflation rate, rent had the most significant positive impact, adding 0.55 percentage point. Holiday home rentals contributed 0.51 point, and fuel added 0.39 point. Meanwhile, electricity prices lowered the annual rate by 0.68 point, food costs decreased it by 0.26 point, and package holidays subtracted another 0.06 point. These movements collectively helped bring the headline inflation rate down from the 1.9% seen in June.
Service prices continue to outperform goods
Prices for restaurants and hotels increased by 8.1% from July 2025, marking the largest rise among key consumer groups. Transport costs went up by 5.5%, while expenses for information and communication grew 4.6%. Education prices increased by 4.5%, and insurance and financial services rose 2.9%. In contrast, prices for food and nonalcoholic beverages declined by 1.6%. Additionally, household furnishings, equipment, and related services saw a 1.1% decrease from the previous year.
The divergence between goods and services prices remained clear during July. Service prices rose 3.8% year-over-year, while the cost of goods dropped 0.7%. The primary driver behind the persistent 2.3% core inflation rate was elevated rents. Meanwhile, housing, water, electricity, gas, and other fuels showed no significant annual change. Prices for health increased by 0.7%, and recreation, sport, and culture items went up by 0.8%. These figures underscore that service costs continue to grow faster than physical goods prices.
Harmonised inflation also exhibits a downward trend
Denmark’s harmonised index of consumer prices grew by 1.6% from July 2025, a slowdown from 1.8% in June. This indicator facilitates comparisons of inflation rates across European Union nations. The Danish national consumer price index includes owner-occupied housing through estimated rental values, but the harmonised measure excludes this component. In June, Sweden recorded harmonised inflation of 1.0%, and the Czech Republic reported 1.1%. Complete comparable data for July was not yet available alongside Denmark’s release.
The net price index increased 2.6% year-over-year in July, slightly lower than June’s 2.7%. This measure adjusts for indirect taxes and duties where applicable and accounts for subsidies that lower consumer costs. The harmonised index at constant tax rates rose by 2.4% from July 2025. Statistics Denmark compiles the consumer price index based on approximately 23,000 prices collected from around 1,600 shops, companies, and institutions. The next update for Denmark’s consumer prices is scheduled for September 10.