Annual Inflation Rate Now at 7.6%

Reykjavík walking district laugavegur

The latest numbers released today by Statistics Iceland indicate that the annual inflation rate now rests at 7.6%.

The government has introduced measures to fight inflation over the past few months, including increasing security pensions, curtailing salaries for senior officials, and the postponement of several construction projects.

Earlier this year, Íslandsbanki forecast that inflation rates would drop to 8% by year-end.

Some of the reduction can be accounted for by summer clearance sales, which have partially driven down the costs of some consumer goods, such as clothing and consumer electronics.

Clothes and shoes have decreased in price by 7.7 per cent, while furniture and household appliances have decreased by 2.4 per cent.

Sales have been relatively strong in the past three years, which can be attributed to the high demand during COVID for such products.


The cost of housing in private homes decreased by 0.7 per cent, but airfares increased by 13.9 per cent. Additionally, the wage index has increased by 1.1 per cent in the last twelve months, and by 10.9 per cent over the past twelve months.

The Monetary Policy Committee is set to reassess interest rates on August 23, and it is possible that these latest developments may be taken into consideration.

Deep North Episode 35: Of Ashes and Evergreens

hekla forest project

Icelandic forestry is no longer the oxymoron it once was, but as it grows in importance as well as size, so also grow disagreements about its future and methods. At the centre of the debate is the coming merger (or rather, reunion: the once-united agencies were split apart in 1914) of the Icelandic Forest Service and the Soil Conservation Service, which has thrown some of these disagreements into sharper relief, including the use of non-native species and the role of the carbon credit market in Icelandic forestry. No matter their differences, everyone who participates in the afforestation effort’s goal is simple: to reclaim a part of the original landscape. One of Iceland’s greatest successes in the field is Hekla Forest (Hekluskógar), nestled in the once-lush Þjórsárdalur valley.

Read the story here.

A Second House at Stöng Found in Archaeological Dig

icelandic farmhouse stöng

A second house has been unearthed at the Stöng archaeological site, Morgunblaðið reports.

Stöng, located in Þjórsárdalur valley in South Iceland, is one of the best-known farms from the time of settlement. Today, it is home to a heritage museum which features both a recreation of a settlement-era farmstead and church.

Oddgeir Isaksen, archaeologist at the Cultural Heritage Agency of Iceland, stated to Morgunblaðið: “There were plans in place to repair the shelter over the ruins at Stöng and to set up an observation platform at the eastern end of the excavation site, so an archaeological investigation was necessary.”

During these exploratory excavations, a building was found at the eastern end of the excavation site. The building is dated as being contemporary with the eruption of Hekla, one of Iceland’s largest volcanoes, in 1104. The 1104 Hekla eruption is believed to have caused significant damage to the area.

Oddgeir continued: “This confirms what has long been believed, that there was a settlement here from around 950 until 1104. There have been significant volcanic eruptions here; it has been a heavily affected area, and not very habitable afterward.”

The excavation is expected to be completed soon, at which point experts will need to decide how to best preserve the ruins. Plans are currently to incorporate the ruins into the current exhibit at Stöng.


[visual-link-preview encoded=”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”]