Luxembourg’s inflation rate is set to stabilize at 2.3% for 2024, in line with earlier predictions from the National Institute of Statistics and Economic Studies (STATEC).

This figure indicates a slowdown in inflation, influenced by recent trends and adjustments in price measures. STATEC forecasts a modest increase to 2.6% in 2025 due to the gradual phase-out of energy price support measures.

The next wage indexation in Luxembourg is expected for the last quarter of 2024, with a subsequent adjustment anticipated in Q4 2025. These indexations are linked to inflation and are designed to balance economic stability with cost-of-living adjustments.

Despite the projected rise in inflation, STATEC will maintain the current indexation parameters to ensure that planned adjustments continue as outlined.

As of July 2024, Luxembourg's annual inflation stands at 2.0%, the lowest since early 2021. This decrease is attributed to a drop in core inflation and a slowdown in petroleum product prices. Core inflation, which excludes volatile items like food and energy, has also significantly eased, contributing to the overall reduction.

STATEC’s updated forecast reflects a more stable inflationary environment than previously expected. Although the 2025 inflation forecast has been revised down from 3.1% to 2.6%, a rise is still anticipated due to the gradual removal of energy price caps.

The government plans to cap electricity price increases at 30% and raise gas prices by 14%, measures intended to mitigate the inflationary impact while reflecting trends in the energy markets.

Inflation in the eurozone has remained steady around 2.5% to 2.6% in recent months. Luxembourg’s inflation is expected to align closely with broader eurozone trends, although specific national factors, such as energy price policies, will affect the exact figures.

RTL

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