Luxembourg's inflation rate has fallen: what to expect in May?

According to the STATEC statistical institute, annual inflation in Luxembourg fell from 1.7% in February to 1.3% in March 2025. The reason for this was primarily a sharp adjustment in energy prices: diesel fell in price by 3.7%, petrol by 4.5% and fuel oil by 6.0%. This was also reflected in the decrease in the overall consumer price index by -0.2% compared to February.

At the same time, seasonal changes are also observed: prices for cut flowers after St Valentine's Day fell by 7.8% and hotel accommodation by 2.5%. However, childcare services rose in price by 4.0 per cent. Food inflation remains moderate, rising 0.2% in March compared to February, but 0.9% year-on-year. Some products such as chocolate (+4.5%) and butter (+2.7%) rose in price, while the prices of fish, vegetables and cereals went down.

Particular attention is now focused on the threshold value of the price index, on which the indexation of wages depends. In March, the index was 1012.69 points. If inflation reaches 0.56% in April, the threshold of 1013.46 points will be exceeded - this will activate a new indexation, which means that salaries may automatically increase from May.

In addition, the so-called "core inflation" - excluding energy and foodstuffs - fell to 1.5 per cent, which indicates stable price dynamics.

The March results reinforce Luxembourg's position as one of the EU countries with the most controlled inflation, despite the unstable international environment. STATEC will publish preliminary inflation data for April on 29 April, which will determine the final decision on indexation.