Austria: Harmonized inflation falls to a near three-year low in May
Harmonized inflation edged down to 3.3% in May, following April’s 3.4%. May’s reading marked the weakest inflation rate since September 2021, though it remained above the Euro area average of 2.6%. The result was driven by moderating price pressures for food and non-alcoholic beverages plus housing and utilities, which outweighed faster growth in transportation prices.
Accordingly, the trend pointed down, with annual average harmonized inflation coming in at a near two-year low of 5.2% in May (April: 5.6%). Meanwhile, consumer price inflation fell to 3.4% in May from April’s 3.5%.
Finally, harmonized consumer prices increased 0.10% in May over the previous month, below April’s 0.11% rise. May’s result marked the weakest reading since January.
EIU analysts commented:
“We expect inflation to average 3.5% in 2024. […] If oil prices were to rise again, or if disruptions to shipping in the Middle East push up global freight costs significantly, there is a possibility that this would have a knock-on effect on price-setting in other parts of the Austrian economy and that inflation could remain higher for longer than previously expected,”