The Consumer Price Index (CPI) based on prices in April 2021, is 499.3 points (May 1988=100), 0.71% higher than in the previous month. The CPI less housing cost is 425.9 points, 0.38% higher than in March 2021.

Cost of owner occupied housing (imputed rent) increased by 2.5% (effect on index 0.40%). Prices of food and drinks increased by 1.1% (0.16%, of which milk and cheese was 0.11%).

The CPI is 4.6% higher in April 2021 than in April 2020 and the CPI less housing cost is 4.6% higher than one year ago.

The CPI compiled in the middle of April 2021, 499.3 points, is applicable for indexation purposes in June 2021. The old credit terms index for June 2021 is 9,859 points.

The Icelandic consumer price index 2020-2021
May 1988 = 100 Monthly index Monthly changes, % Annual changes, %

Updated consumption weights
The consumer price index is now published on a new base, March 2021. This update of consumption weights is a routine part of Statistics Iceland’s annual update of weights. The purpose is to reflect private consumption for Icelandic households as well as possible.

The rebasing of the index is primarily built on Statistics Iceland’s household expenditure survey, in line with conventional practice in the CPI. The new base reflects the outcome of Statistics Iceland’s household expenditure survey 2017–2019. The three-year period is aimed to emphasise long-term change and reduce short-term fluctuation.

Household’s consumption patterns have changed considerably during the last year, due to the Covid-19 pandemic and the various protective measures taken. Foreign travelling restrictions have been put in place and various services and events have been restricted. Despite the current positive outlook, the effect of these measures has now been in place for over a year. For these reasons, it was deemed necessary to make special adjustments for the year 2020 when calculating the CPI base-weights. Changes in private consumption in 2020 and various other sources were used for this purpose.

Outlet weights for grocery stores, where the share of discount stores to supermarkets with higher service levels is reflected, changed insignificantly and as a result did not affect the CPI measurement. The rebasing of the index does not in itself have any effect on the CPI results in April. Expenditure shares according to the new and old base in March 2021 can be found in a memorandum here.