Private companies, state utilities, retailers and private and local authority landlords are hiding behind misleading headline deflation figures that purportedly show hefty price falls, a Sunday Tribune investigation has found.

The limited nature of real deflation has the potential to damage Ireland's chances of sharing in any early upswing in the global economy.

Three years of detailed price figures provided by the Central Statistics Office (CSO) spanning the five largest product areas on which Irish households spend their money show that this summer most prices of goods and services have barely fallen.

The price of many goods, despite the economic slump, are rising at their fastest rate for three years.

The rapid fall in mortgage interest rates has helped disguise the hidden price trends behind the headline inflation reports, leading to the widespread perception among government policy makers that price deflation has taken root in the Irish economy and that households can absorb wage and welfare cuts.

With the latest monthly inflation report due to be published this week, the CSO figures for the last three years reveal most prices this summer are still above 2006 boom-time levels.

The National Competitiveness Council (NCC), set up by the government almost a decade ago, has consistently warned that Ireland was among the most expensive locations to do business because of its high consumer price inflation rates. "High inflation is driven by price increases in housing, utilities, education, health and catering," the NCC said in its latest report in January.

The limits of deflation

» Water, electricity and gas costs to households are 8% more costly than 2006.

» Households are paying 17% more for their home loan payments than the summer of 2006.

» Landlords have passed on only about half of the cuts of mortgage interest rates. Private rents remain at levels reached at the height of the property boom.

» The price of a package holiday has risen this summer at the fastest rate for three years, at almost 10% more than 2006.

» Local authority rents are 30% higher than in 2006.

» Food prices in the shops, despite recent price cuts and the surging value of the euro against sterling, are 7% more expensive than boom time prices three years ago.

» Restaurants and hotels prices are 7% costlier than the boom.