Italy's inflation accelerates to 4.2% in September, a three-year high

Italy's national statistics agency, Istat, has released preliminary data showing that the national consumer price index rose 0.7% month on month in September, pushing the annual inflation rate to 4.2%, up from 3.3% in August. This is the highest annual rate recorded since September 2023, when it stood at 5.3%.

Energy and food drive the increase

The main driver behind September's acceleration was energy, with the annual growth in energy goods prices jumping from 17.1% to 22.3%. Regulated energy prices rose 25.9% year on year, up from 18.6% in August, while unregulated energy prices increased 22.2%. Fresh food products, such as fruit and vegetables, also saw faster price growth, rising from 3.8% to 5.5% annually. Recreational and cultural services (up 2.9%) and transport-related services (up 1.6%) also accelerated, though transport recorded a seasonal monthly decline.

Core inflation remains more contained

Core inflation, which excludes energy and fresh food, rose only modestly, from 1.5% to 1.7%, suggesting current price pressures remain concentrated in energy and fresh food. Meanwhile, the gap between goods and services inflation widened further, with goods prices up 5.4% annually compared with a 2.6% rise in services prices.

Fuel prices and falling confidence

Italy's Ministry for Business and Made in Italy reported a slight easing in average pump prices, though it noted significant price differences between retailers nationwide. At the same time, both consumer and business confidence indices declined sharply — from 94.5 to 91.2 points and from 97.0 to 95.9 points respectively — signalling growing caution among households and companies over spending and investment.