Austria: Harmonized inflation hits 10-month high in January
Latest reading: Harmonized inflation jumped to 3.4% in January from December’s 2.1%, marking the highest inflation rate since March 2024 and exceeding the ECB’s 2.0% inflation target. Looking at the details of the release, housing and utilities prices soared in January after dropping in the previous month amid the expiry of the electricity price cap, the increase in the CO2 tax and grid fees for electricity and natural gas. Moreover, price pressures for food and transportation picked up pace.
That said, the trend pointed down slightly, with annual average harmonized inflation coming in at 2.8% in January (December: 2.9%). Meanwhile, consumer price inflation rose to 3.2% in January from the previous month’s 2.0%.
Finally, harmonized consumer prices rose 0.86% in January over the previous month, accelerating from December’s 0.68% rise. January’s figure was the highest reading since September 2023.
Panelist insight: Commenting on the outlook EIU analysts stated:
“Risks are tilted to the upside: should oil prices rise again, or if disruptions to shipping in the Middle East push up global freight costs significantly, this could have a knock-on effect on price-setting in other parts of the Austrian economy, and inflation could remain higher for longer than previously expected.”