The Planning Bureau has recently released new forecasts on inflation and the health index for the year. According to these forecasts, inflation is expected to be slightly lower than previously predicted at 3.1 percent, compared to the previous forecast of 3.3 percent in April. In comparison, last year saw an annual inflation rate of 4.06 percent, while in 2022 it was a significant increase of 9.59 percent. Looking ahead, the Planning Bureau predicts an average annual inflation rate of 1.9 percent for next year.
In addition to inflation, the health index is also expected to play a crucial role in determining wages, social benefits, and rental prices this year. The Planning Bureau forecasts that the health index will be at 3.1 percent this year and decrease to 2.0 percent by 2025. Last year, the health index was at a high of 4.33 percent, while in 2022 it reached its peak at 9.25 percent due to various factors affecting lifespan expectancy.
In April this year, the key index for government wages and social benefits was exceeded by a small margin leading to adjustments of 2 percent for social benefits in May and government employee wages in June due to an increase in lifespan expectancy.
The previous time this index was exceeded was in October last year with the next expected exceedance predicted for February 2025 according to the Planning Bureau’s latest forecasts.
Overall, these forecasts highlight that while inflation rates are expected to decrease slightly compared to last year’s estimates; other factors such as lifespan expectancy could still impact key indices that determine wages and social benefits.
