Italian Inflation Softens as Expected

The annual inflation rate in Italy eased to 2.8% in July of 2026 from 3% in the previous month, aligned with the median market consensus, according to a preliminary estimate. It was the second pullback since the rate surged to an over-two-year high of 3.2% in May, reflecting some softening as the temporary resumption of energy exports from the Middle East brought relief to wholesale prices in the period. Non-regulated energy inflation, which are more sensitive to swings in global benchmarks, eased to 10.6% from 13.3% in June. Prices also slowed for fresh food (3.8% vs 4.4%) and broad services (1.8% vs 2.5%). In turn, prices rebounded for non-fresh food (0.2% vs -0.2%) and rose faster for regulated energy (14.9% vs 9.2%) and transportation services (1.6% vs 1.1%). Core inflation, which excludes energy and fresh food prices due to their often exogenous price swings, eased to 1.8% from 1.9%).

Italy’s headline inflation rate eased to 3.0% in June 2026 from a more than two-and-a-half-year high of 3.2% in May, confirming preliminary estimates. This was the first deceleration in consumer inflation since January, amid softer price increases in unprocessed food (4.4% vs 5.5% in May), recreational, cultural, and personal care services (2.7% vs 3.0%), and transport-related services (1.1% vs 1.7%). However, higher energy prices stemming from supply pressures in the Middle East continued to feed through to consumers, with prices for both regulated energy (9.2% vs 5.6%) and unregulated energy (13.3% vs 12.5%) accelerating. On a monthly basis, consumer prices were unchanged in June after rising 0.4% in the previous month. Core inflation, excluding energy and fresh food, edged down to 1.6% from 1.7%, while inflation excluding energy alone also eased to 1.9% from 2.1%. The HICP was unchanged month-on-month and rose 3.0% year-on-year, slowing from 3.2% in May.

The headline national inflation rate in Italy softened to 3.0% in June of 2026 from 3.2% in the previous month, according to a preliminary read. It was below market expectations of a 3.1% rate and marked the first deceleration in consumer prices since January, potentially pointing to the top of the inflationary surge from the war in the Middle East as wholesale energy prices pulled back in the period. Price growth eased for non-processed food (4.5% vs 5.5% in May), cultural and recreational services (2.7% vs 3.0%), and transportation services (1.1% vs 1.7%). Still, higher energy prices in commodity markets from supply pressures in the Middle East were still being transmitted to Italian consumers, with faster inflation for regulated energy (9.3% vs 5.6%) and non-regulated energy (12.9% vs 12.5%). Since the pickup in inflation was concentrated in energy, the core inflation rate softened to 1.6% from 1.7%. From the previous month, Italian consumer prices were unchanged.