Inflation picks up in March from the prior month

Latest reading: Harmonized consumer prices rose 3.1% on a year-on-year basis in March, following a 2.3% rise in the previous month. The acceleration was driven by higher energy costs in light of the Iran war. Relative to the previous month's data, there were higher price pressures for transportation (+7.3% on a year-on-year basis vs +1.8% in February), housing and utilities (+2.8% vs +1.2% in February) and recreation (+3.8% vs +3.0% in February). In contrast, there were milder price pressures for food and non-alcoholic beverages (+2.1% vs +2.2% in February) and restaurants and hotels (+4.3% vs +4.5% in February). Meanwhile, consumer prices rose 3.2% on a year-on-year basis in March, following a 2.3% increase in the prior month. Finally, harmonized consumer prices increased 1.12% in March in month-on-month terms, following a 0.76% increase in the previous month.

Panelist insight: EIU analysts said: “We have increased our headline inflation forecast for 2026 from 2.3% to 2.6%, as a result of the energy-price shock stemming from the war in Iran. Austria is less exposed to fossil fuel prices than some other European countries, given that it is a leader in renewable energy for electricity. However, it is still heavily reliant on imports, particularly transits through European countries' LNG terminals.”

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