Italy: Harmonized inflation increases in June
Harmonized inflation rose to 1.0% in June, following May’s 0.8%. The increase was primarily driven by a softer decline in housing and utilities prices plus stronger price pressures for miscellaneous goods and services. Meanwhile, price rises for food, transport, and recreation, repair and personal care softened from the prior month, and prices for durable goods declined at a faster pace, offsetting some of the overall upward pressure.
Annual average harmonized inflation fell to 2.1% in June (May: 2.6%). Meanwhile, consumer price inflation was stable, remaining at May’s 0.8% in June.
Lastly, harmonized consumer prices increased 0.14% in June over the previous month, slowing down from the 0.27% rise seen in May. June’s result marked the softest rise in prices since February.
According to our panelists, harmonized inflation is expected to bottom out in 2024, followed by a slight increase in 2025. This deceleration will be largely driven by a drop in prices of energy and imported goods, which will more than offset strong wage growth. Inflation risks are balanced, with possible upward pressures from commodity price increases and possible downward pressures from a prolonged deterioration in aggregate demand.