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Italy Inflation June 2023

Italy: Harmonized inflation falls to lowest level since April 2022 in June

Harmonized inflation came in at 6.7% in June, which was down from May’s 7.9%. June’s figure represented the lowest inflation rate since April 2022. The result was driven by moderating price pressures for food and non-alcoholic beverages and easing price pressures for housing and utilities. Moreover, prices for recreation grew at a more subdued pace.

Annual average harmonized inflation edged down to 9.6% in June (May: 9.8%). Meanwhile, consumer price inflation fell to 6.4% in June, from May’s 7.6%.

Lastly, harmonized consumer prices recorded zero growth from the previous month in June, which was below the 0.35% increase seen in May. June’s result marked the weakest reading since January.

Commenting on the outlook, Paolo Pizzoli, senior economist at ING, stated:

“[In late June] the Italian government prolonged a package of support measures introduced to help households weather the energy shock until the end of September. These measures will partially affect prices through reduced VAT rates, and headline inflation should continue benefiting from favourable conditions over the summer months. This should also apply to core inflation. From October onwards, however, the possible elimination of temporary energy measures and more wage concessions could bring about some renewed stickiness in both headline and core inflation.”

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