Eurozone inflation hits highest since September 2023 as energy costs accelerate

Euro area annual inflation accelerated to 3.3% in August, its highest level since September 2023, when it stood at 4.3%, according to a flash estimate released by Eurostat on Tuesday.

The rate rose from 2.9% in July, remaining above the European Central Bank’s medium-term target of 2%.

Consumer prices increased 0.4% on a monthly basis in August, the EU’s statistical office said.

Energy was the main driver of the acceleration, with annual energy inflation climbing to 14.3% from 10.3% in July. Energy prices increased 2.9% month on month.

Annual inflation for non-energy industrial goods also rose to 1.2% from 0.9%.

In contrast, services inflation eased to 3% from 3.3%, while inflation for food, alcohol and tobacco remained unchanged at 1.2%.

Core inflation, which excludes energy, food, alcohol and tobacco, edged down to 2.4% from 2.5%. Inflation excluding only energy remained stable at 2.2%.

Among euro-area members, Lithuania recorded the highest annual inflation rate at 5.8%, followed by the Greek Cypriot Administration at 5.2% and Bulgaria at 5.1%.

Spain’s annual inflation climbed to 4.5%, while the rate stood at 4.2% in Belgium, 3.2% in Italy, 2.9% in Germany, and 2.7% in France.

The lowest annual rates were recorded in Estonia at 1.3%, Malta at 1.9%, and Finland at 2.4%.