The Government is not doing enough to curb the rising level of inflation, the main Opposition parties claimed today.
This follows the release of data from the Central Statistics Office (CSO) that indicated the annual rate of inflation for July was now running at 4.2 per cent - up from 3.9 per cent in June.
Fine Gael finance spokesman Richard Bruton said the latest Consumer Price Index confirmed that not only is Ireland the most expensive country in the Euro zone, prices here are rising faster than in the rest of the zone.
He said the figures pointed to "dangerous signs of fragility in our economy."
Mr Bruton said the economy has become over-reliant on construction and consumer spending, much of it funded by very rapid increases in borrowing.
"Clearly this is not the time for the Government to be stoking up spending in the economy, but that is exactly what it is doing," he claimed. None of this bodes well for the economy at a time of greater international economic uncertainty, he added.
Labour's consumer affairs spokeswoman Kathleen Lynch said the figures demonstrated the Government's failure to control inflation, which she said was now "spiralling out of control".
Ms Lynch said: "This is appalling news for hardworking families throughout the country, and makes a complete mockery of Finance Minister Brian Cowen's confident forecast in last year's budget that inflation would average 2.7 per cent for the next 12 months."
She said: "The Government has stated that international factors beyond its control - such as interest rates and oil prices - are contributing to the increase.
"This may be true, but every other European country also faces these challenges, yet Ireland's inflation rate continues to run well ahead of the 3 per cent EU average," she added.
ISME, the independent business organisation, called for Government action in response to what it said was a significant jump in inflation.
ISME head of research Jim Curran said: "Even taking into account the significant monthly hike in July there is still very much an upside risk to inflation over the next number of months with the cost of oil, gas and electricity set to rise together with further interest rate increases.
"Consequently, unless the issue is addressed, we will have to get used to a period of sustained high inflation, which will continue to be hugely detrimental to our competitiveness and is the last thing the small business sector needs as it already operates in a high cost environment," he said.
Siptu General President Jack O'Connor called for a reduction in the rate of excise duty on motor fuels.
"These prices are inflating at a rate of 15.7 per cent and severely impacting on the cost of living of working people."
