EuroWire, ROME: Italy’s annual inflation rate slowed to 1.0% in January from 1.2% in December, according to provisional data released by national statistics office Istat. On a monthly basis, consumer prices for the whole nation index excluding tobacco rose 0.4%. Istat also reported the EU harmonised measure of inflation at 1.0% year on year, matching the national rate, as broader price pressures remained contained at the start of 2026.
Food prices and several service categories continued to contribute to annual inflation. Istat said unprocessed food prices were up 2.5% from a year earlier, while processed food including alcohol rose 2.2%. Housing related services increased 4.4% year on year, while tobacco prices were up 3.3%. Recreation, repair and personal care services rose 3.0%. These categories helped offset weaker price dynamics in other areas and the continued divergence between services and goods.
Underlying inflation remained higher than the headline rate. Istat put core inflation, excluding energy and unprocessed food, at 1.8% year on year, and inflation excluding energy at 1.9%. The split between goods and services was marked, with goods prices down 0.2% from a year earlier while services prices rose 2.7%. Istat said the gap between services and goods inflation was 2.5 percentage points, underscoring how service costs continued to rise faster than retail goods.
January’s 0.4% monthly increase was driven mainly by energy and household related expenses. Istat reported regulated energy prices rose 8.7% from December, while non regulated energy rose 0.8%. Housing related services increased 1.9% on the month. Unprocessed food rose 1.2%, processed food including alcohol gained 0.9%, and recreation, repair and personal care services increased 0.7%. The main offset came from transport related services, which fell 3.7% on the month.
Food prices still outpace headline inflation
Istat’s measure for groceries and unprocessed food, often used as a proxy for frequently purchased items, rose 2.1% year on year in January. The figure highlighted a faster pace of price increases for staples compared with the overall inflation rate, even as headline inflation eased. Within the broader basket, Istat’s breakdown showed the persistence of higher costs in areas tied to daily consumption and household services, while other categories contributed less to the annual total.
The EU harmonised index of consumer prices fell 1.0% on the month while rising 1.0% year on year, Istat said, reflecting seasonal patterns and category level price moves captured under the harmonised framework used for European comparisons. Istat noted that indices from January 2026 are published using an updated classification, ECOICOP version 2, and a new base year of 2025 set to 100, changes that can affect the presentation and mapping of spending categories over time.
Italy below euro area inflation rate
Eurostat’s January flash estimate put euro area annual inflation at 1.7%, down from 2.0% in December, while Italy’s harmonised rate stood at 1.0%. The comparison placed Italy below the currency bloc average at the start of the year. The euro area estimate is based on national submissions under the harmonised methodology, allowing inflation rates to be compared across member states using the same standards for coverage and calculation.
Istat said the January figures were provisional, with updated results scheduled for release on Feb. 23. The data showed inflation continuing to cool from late 2025 levels while remaining supported by food and service costs, especially housing related services and regulated energy. The contrast between falling goods prices and rising service prices remained a defining feature of Italy’s inflation profile, alongside a higher core measure that stayed above the 1.0% headline rate.