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Inflation climbs to 7% during May, highest rate for 30 years

The rise in consumer prices was mostly driven by the increasing cost of electricity, petrol and diesel, Statistics Finland says.

The price of petrol was up from was 2.21 euros per litre at the beginning of May to 2.53 euros by the end of the month. Image: Mikko Koski / Yle

The inflation rate in Finland has risen to its highest level in over 30 years, hitting 7.1 percent during the month of May.

The latest consumer price index calculated by Statistics Finland further noted that the pace of inflation has risen significantly since April, when the rate stood at 5.7 percent.

The number-crunching agency's report found that the increase in inflation was caused by higher prices of electricity, petrol and diesel, as well as among other products and services, including a sharp rise in the cost of renovating single-family homes.

The data further revealed that the average price of petrol in the first week of May was 2.21 euros per litre but had risen to 2.53 euros by the end of the month, while the price of a litre of diesel went from 2.24 euros to 2.34.

Writing on Twitter, the Finnish Chamber of Commerce's Chief Economist Jukka Appelqvist said that the last time Finland's monthly inflation rate was over 7 percent was in February 1990.

Juho Keskinen, an economist at mortgage association Hypo, noted that the current rise in prices is unprecedented for many people.

"The level of earnings is not keeping pace now and purchasing power is declining. When house prices rise by 3 percent, it actually means they are falling in price, as the general price level rises more than twice as fast," Keskinen wrote.

Statistics Finland's preliminary data also revealed that inflation in the euro area increased to 8.1 percent in May, with official consumer price information expected to be released on Friday.