Eurostat: only one EU state with inflation in double digits

Eurostat, the statistical office of the European Union, announced on Wednesday that the euro area annual inflation rate was 4.3% in September 2023, down from 5.2% in August. A year earlier, the rate was 9.9%.

"European Union annual inflation was 4.9% in September 2023, down from 5.9% in August. A year earlier, the rate was 10.9%" - the stats office said.

Eurostat also published Harmonised Index of Consumer Prices (HICP) recorded in respective EU states.

"Compared with August, annual inflation fell in twenty-one Member States, remained stable in one and rose in five," we read in a statement.

According to the index, the Netherlands reported deflation in September 2023, while Hungary saw the highest increase in prices in the bloc and was the only EU state with inflation in double digits.

The lowest annual rates were registered in the Netherlands (-0.3%), Denmark (0.6%) and Belgium (0.7%), while the highest - in Hungary (12.2%), Romania (9.2%) and Slovakia (9.0%).

"In September, the highest contribution to the annual euro area inflation rate came from services (+2.05 percentage points, pp), followed by food, alcohol & tobacco (+1.78 pp), non-energy industrial goods (+1.06 pp) and energy (-0.55 pp)" - Eurostat added.

The fourth-highest inflation was reported in the Czech Republic - Eurostat said - with 8.3% y/y. Poland was right behind its southern neighbors with inflation in September at 7.7%.

The Harmonised Index of Consumer Prices, abbreviated as "HICP", is a consumer price index that is produced by each European Union Member State using a harmonised methodology. These indices are directly comparable between countries and can be aggregated. The aim is to provide a high-quality and comparable measure of consumer price inflation.

The HICP serves two main purposes:

- it is used as an indicator for assessing price convergence with regard to a possible accession of a country to the monetary union (euro currency);

- it is a measure of price stability for the European Central Bank's (ECB) monetary policy strategy. The Governing Council of the ECB has defined price stability in terms of the Harmonised Index of Consumer Prices (HICP) for the euro area.

In addition, like any other consumer price index the HICP is used for economic analyses and indexing contracts.

HICP data are published by Eurostat, while national CPIs are published by National Statistical Institutes.