Euro Area Inflation Rises to 3.2 Percent as Energy Prices Climb 14.3 Percent
Euro area annual inflation rose to 3.2 percent in August from 2.9 percent in July, Eurostat said on 17 September. That is 0.1 point below its 1 September flash estimate of 3.3 percent and equal to May’s rate. A year earlier the rate was 2.0 percent. Prices rose 0.4 percent from July.
Energy drove the rise
Energy prices rose 14.3 percent over the year, up from 10.3 percent in July, and 2.9 percent in the month alone. Energy has a weight of only 90.3 per thousand in the basket, yet it contributed 1.29 points of the 3.2 percent rate. On our calculation that is 40 percent of all euro area inflation from less than 10 percent of the spending.
On our calculation energy added 0.35 points more than in July and services 0.12 points less, as services inflation eased to 3.0 percent from 3.3 percent. Energy alone more than covers the 0.3 point rise in the headline, and without it the rate would have fallen.
| Component | July | August |
|---|---|---|
| All items | 2.9% | 3.2% |
| Energy | 10.3% | 14.3% |
| Services | 3.3% | 3.0% |
| Non-energy industrial goods | 0.9% | 1.2% |
| Food, alcohol and tobacco | 1.2% | 1.1% |
| Excluding energy, food, alcohol and tobacco | 2.5% | 2.4% |
Annual rates, euro area of 21 members. Weights for 2026: energy 90.3, services 468.2, non-energy industrial goods 252.2, food, alcohol and tobacco 189.4 per thousand.
The measure excluding energy, food, alcohol and tobacco eased to 2.4 percent, and inflation excluding energy alone fell to 2.1 percent. It was 2.5 percent in August 2025. On our calculation the gap between headline and core is now 0.8 points. A year ago core ran 0.3 points above the headline.
| Contribution | July | August |
|---|---|---|
| Services | 1.55 | 1.43 |
| Energy | 0.94 | 1.29 |
| Non-energy industrial goods | 0.23 | 0.30 |
| Food, alcohol and tobacco | 0.23 | 0.22 |
Contributions to the euro area annual rate, in percentage points.
20 EU member states up, 6 down
Across the European Union, annual inflation rose in 20 member states, fell in 6 and held in 1. Spain climbed to 4.6 percent from 3.9 percent and Greece to 3.7 percent from 2.7 percent. Of the largest economies, Italy rose to 3.2 percent, France to 2.6 percent and Germany to 2.9 percent, while the Netherlands eased to 2.8 percent. Romania had the highest rate at 6.3 percent, down from 8.2 percent, and Sweden the lowest at 0.3 percent.
| Country | July | August |
|---|---|---|
| Germany | 2.8% | 2.9% |
| France | 2.4% | 2.6% |
| Italy | 2.9% | 3.2% |
| Spain | 3.9% | 4.6% |
| Netherlands | 3.0% | 2.8% |
HICP annual rates.
Why it matters: The euro area headline is back above 3 percent because of energy. Services inflation slowed, and the core annual rate eased to 2.4 percent. On our reading, how long energy stays at these levels will decide whether the headline rate comes down or feeds into prices more widely.
Outlook: Eurostat will publish its flash estimate for September on 2 October and the full September release on 16 October.
Sources: Eurostat.
