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Italy EU-harmonised CPI slows to 2.9% y/y in July, slightly above forecast - Finance news and analysis from Global Banking & Finance Review
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Italy EU-harmonised CPI slows to 2.9% y/y in July, slightly above forecast

Published by Global Banking & Finance Review

Posted on July 31, 2026

1 min read

· Last updated: July 31, 2026

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Finance Banking Markets Inflation Italy

Italy’s EU-Harmonised CPI Drops in July as Annual Inflation Slows to 2.9%

Overview of Italy's July Inflation Data

Monthly and Annual Changes in Consumer Prices

ROME, July 31 (Reuters) - Italian EU-harmonised consumer prices (HICP) fell 1.0% in July from the month before due to seasonal summer discounts, with the annual inflation rate slowing slightly to 2.9% from June's 3.0%, preliminary data showed on Friday, amid high energy costs due to turmoil in the Middle East.

Analyst Expectations vs. Actual Results

The year-on-year reading was slightly above a median forecast in a Reuters survey of 17 analysts which pointed to a rise of 2.8%, whereas the month-on-month data matched the forecast.

Other Key Inflation Indicators

Main Domestic Price Index (NIC)

Official statistics agency ISTAT also reported that the main domestic price index (NIC), which excludes temporary discounts, was up 0.2% month-on-month in July and up 2.8% annually, following a 3.0% annual rate in June.

Core Inflation Trends

HICP Core Inflation Acceleration

Core inflation (net of fresh food and energy) was running at 1.7% year-on-year on the HICP index in July, accelerating from 1.5% in June.

(Reporting by Antonella Cinelli, graphic by Stefano Bernabei, editing by Gavin Jones)

Key Takeaways

  • HICP slowed to 2.9% y/y in July, just above the 2.8% Reuters median forecast; the 1.0% m/m drop aligns with expectations, reflecting summer sales.
  • NIC inflation remained firmer: up 0.2% month‑on‑month and 2.8% year‑on‑year, signaling more persistent underlying price growth.
  • Core HICP (excluding fresh food and energy) accelerated to 1.7% y/y, up from 1.5% in June, showing broadening inflation despite discount‑induced headline relief.
  • Energy cost pressures from the Middle East crisis continue to underpin inflation, though their pass‑through remains moderated in utility bills.
  • According to Banca d’Italia and ECB projections, headline inflation may average around 3.0–3.1% in 2026 before easing toward the ECB’s 2% medium‑term goal.

Frequently Asked Questions

What was Italy's EU-harmonised CPI inflation rate in July?
Italy's annual EU-harmonised CPI inflation rate slowed to 2.9% in July from 3.0% in June.
How did Italy's monthly EU-harmonised CPI change in July?
The monthly EU-harmonised CPI in Italy fell by 1.0% in July due to seasonal summer discounts.
What was core inflation in Italy for July?
Core inflation, excluding fresh food and energy, was 1.7% year-on-year on the HICP index in July, up from 1.5% in June.
What factors influenced Italy's inflation in July?
High energy costs due to Middle East turmoil and seasonal summer discounts were key factors.

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