Eurostat reports a reduction in Eurozone inflation, marking the lowest rate of the year, driven by a decline in energy prices.
Eurostat, the statistical office of the European Union, estimates that the annual inflation rate in the Eurozone reached 1.8% in September 2024, reflecting a decrease from the 2.2% recorded in August. This drop highlights a trend of slowing price increases, with notable variations in key inflation components such as services, energy, and food.
Among the components impacting Eurozone inflation, services continue to have the highest annual rate, reaching 4.0% in September, although this shows a slight reduction compared to August’s 4.1%. Food, alcohol, and tobacco, the second largest component, showed a modest increase in the annual rate to 2.4% from 2.3% in August. Non-energy industrial goods remained stable at 0.4%, while energy saw a significant drop from -3.0% to -6.0%, a critical factor in the overall reduction in annual inflation.
Inflation Across Member States
Inflation varies significantly between Eurozone countries. Some countries, like Germany and France, recorded lower inflation rates, with estimated annual rates of 1.8% and 1.5%, respectively. In contrast, other countries show higher figures: Slovakia’s annual inflation remains at 2.9%, while Greece stands at 3.0%. These differences reflect national factors, such as the cost of services and goods or dependency on energy products.
Key Influences: Energy as a Decisive Factor
The sharp drop in energy prices remains a major factor influencing the reduction of inflation in the Eurozone. Energy has shown an annual variation of -6.0%, accelerating its decline from -3.0% in August. This is partly due to adjustments in energy tariffs and lower demand in some countries, which have helped contain energy’s impact on the overall consumer price index.
Calendar and Expectations
The preliminary inflation estimate is an initial measure released at the end of each reference month. For September 2024, the full data on the Harmonized Index of Consumer Prices (HICP) will be available on October 17. The annual variation indicates how the prices of goods and services have changed over the year, while the monthly variation measures the change in prices from one month to the next.
With these data, inflation in the Eurozone has been seen moderating over recent months. This downward trend is expected to continue depending on the stabilization of energy prices and the containment of non-energy goods prices, providing a more favorable outlook for the end of 2024.