Italy: Harmonized inflation edges up in October
Latest reading: Harmonized inflation increased to 1.0% in October from September’s 0.7%. The reading overshot market expectations, but remained below the Euro area average and the ECB’s target of 2.0%. Looking at the details of the release, the uptick was driven by stronger price pressures for food and non-alcoholic beverages. Moreover, transportation costs declined at a milder pace. That said, housing and utilities prices fell at a quicker pace.
That said, the trend pointed down slightly, with annual average harmonized inflation coming in at 0.9% in October (September: 1.0%). Meanwhile, consumer price inflation ticked up to 0.9% in October from the previous month’s 0.7%.
Lastly, harmonized consumer prices increased 0.33% in October over the previous month, slowing down from September’s 1.15% increase.
Panelist insight: Sofia Tozy, analyst at Credit Agricole, commented:
“In 2025, inflation is projected to increase only slightly, reaching 1.5%, marking the end of the normalization phase for energy prices. At the same time, core inflation is expected to slow significantly, decreasing from 2.6% in 2024 to 1.6% in 2025, driven by the combined effects of a slowdown in goods prices, which will fall from 1.2% in 2024 to 0.2% in 2025, and a shift in the dynamics of services inflation, which is expected to be 2.5% in 2025, down from 3.4% in 2024.”