The annual inflation rate in Italy was unchanged from the prior month at 1.9% in April 2025, revised slightly lower from the preliminary estimates of 2.0% and marginally below the initial market expectations of 2.0%.
Italy inflation rate revised lower
This figure keeps Italy's inflation rate at its highest level in 18 months, extending the ongoing normalization phase of the Italian consumer price basket, which in the past few years has been marked by periods of sharp volatility due to food and energy shocks triggered by the aftermath of the Russian invasion of Ukraine.
The latest data showed that prices rose more strongly in several key sectors. Regulated energy costs surged by 31.7% compared to 27.2% in March, reflecting the pass-through of earlier wholesale price pressures, while transportation services inflation accelerated sharply to 4.4% from 1.6%, driven largely by the Easter holiday period and higher travel demand both domestically and across the EU. Food prices also climbed at a faster pace, with fresh food inflation picking up to 4.2% from 3.3%, and processed food prices accelerating to 2.2% from 1.9%, amid persistent supply chain bottlenecks and higher agricultural input costs.
In contrast, non-regulated energy prices swung back into deflationary territory, falling by 3.4% after a slight increase of 0.7% in the previous month, as global oil and gas prices stabilized and the euro’s recent strength helped ease import price pressures. The core inflation rate, which strips out volatile items such as energy and unprocessed food, rose more than anticipated to 2.1% from 1.7% in March, marking the highest level in a year and signaling that underlying price pressures may be firmer than headline figures suggest.
Monthly figures
On a monthly basis, the Italian consumer price index rose by just 0.1%, easing from a 0.2% increase in March, as lower energy bills partially offset price increases in services and food. Meanwhile, the harmonized index of consumer prices (HICP), which is used for EU-wide comparisons, was confirmed at 2.0% year-on-year, slightly down from 2.1% in March.
The data will likely keep the European Central Bank's attention focused on the dynamics of core inflation, as policymakers weigh the case for further rate cuts in the coming months. Some analysts noted that the sharp rebound in core inflation in Italy could complicate the ECB’s dovish pivot, especially if similar patterns emerge across other euro area economies. At the same time, the persistence of elevated regulated energy costs highlights the ongoing sensitivity of the Italian economy to energy policy shifts and global commodity markets.
Looking ahead, market participants will closely monitor upcoming wage data and business sentiment surveys to assess the extent to which inflation pressures might become more entrenched, particularly in the services sector, which has remained resilient despite broader economic headwinds. The government is also expected to present new measures aimed at cushioning households from rising living costs, which could have implications for both consumer spending and inflation dynamics in the second half of the year.
