Netherlands says inflation overstated on account of skewed power value calculation By Reuters

© Reuters. FILE PHOTO: Folks do their Christmas purchasing earlier than the Dutch authorities’s anticipated announcement of a “strict” Christmas lockdown to curb the unfold of the Omicron coronavirus variant, within the metropolis centre of Nijmegen, Netherlands December 18, 2021. REUTE

AMSTERDAM (Reuters) – Statistics Netherlands (CBS), the Dutch authorities’s statistics workplace, is an issue with its power value measurements, which it mentioned has triggered the nation – and presumably different European nations – to overstate inflation.

Dutch inflation ran at 16.8% in October from a 12 months earlier, nicely above the eurozone common of 10.6%.

The issue is the company makes use of solely newly-signed contracts to find out gasoline and electrical energy prices within the basket of products and providers bought by a typical Dutch family. However many households have older contracts that have been struck at a lower cost.

“This implies the value info obtained via the present statement technique is definitely forward of the common value improvement of power for households within the Netherlands,” the company mentioned in an announcement, asserting plans to introduce a system in mid-2023.

The impression could also be vital, the company mentioned, as power prices account for about half of this 12 months’s rise in costs.

It has lately begun accumulating info from utility firms about all current contracts, quite than solely the brand new ones.

With info from about 75% of households, it believes that inflation in August may very well have been solely 7.5-9.6%, in comparison with the 12% it reported.