In December, inflation in Italy is back on track: +1.2% year-on-year

In December, according to preliminary Istat estimates, inflation rose to +1.2% year-on-year (increase of 0.2% month-on-month), returning to the October level. In the average 2025, consumer prices rose by 1.5% year-on-year, accelerating compared to the figure recorded in 2024 (+1.0%). The annual average inflation trend is weighed down by the price dynamics of Regulated Energy Goods (+16.2% from -0.2% in 2024) and Unprocessed Food (+3.4% from +2.3%). In 2025, core inflation stops at +1.9% (from +2.0% in 2024).

In December, the pace of year-on-year growth in the prices of food, household and personal care goods accelerated. The so-called 'spend cart' rose from +1.5% in November to +2.2%. While high-frequency products rose from +2.0% to +2.2%. This is what Istat estimates in its preliminary data for December.

In the third quarter of 2025, households' purchasing power and propensity to save increased, reaching the highest levels since the third quarter of 2009, excluding the Covid period. This is what Istat noted in another report, pointing out that final consumption expenditure remains weak, however. In detail, household disposable income grew by 2 per cent compared to the previous quarter, while consumption grew by 0.3 per cent. The propensity to save is estimated at 11.4 per cent, up 1.5 percentage points from the previous quarter. Purchasing power finally grew compared to the previous quarter by 1.8%.

According to Eurostat's flash estimate, annual inflation in the euro area is expected to stand at 2% in December 2025, down from 2.1% in November. Looking at the main components, services are expected to register the highest annual rate in December (3.4%, compared to 3.5% in November), followed by food, alcohol and tobacco (2.6%, compared to 2.4% in November), non-energy industrial goods (0.4%, compared to 0.5% in November) and energy (-1.9%, compared to -0.5% in November).