Consumer Prices in Italy – November 2023

In November 2023, Italy’s National Consumer Price Index (NIC) is estimated to decrease by 0.5% on a monthly basis, with a year-on-year increase of 0.7%, down from the previous month’s 1.7% (preliminary estimate was 0.8%).

The deceleration in inflation is primarily attributed to energy prices, both regulated (from -31.7% to -34.9%) and unregulated (from -17.7% to -22.5%). Additionally, a slight slowdown is observed in processed foods (from +7.3% to +5.8%), recreational and cultural services (from +5.5% to +4.6%), and transport-related services (from +4.0% to +3.5%). These effects are only partially offset by the acceleration in prices of unprocessed foods (from +4.9% to +5.6%).

Core inflation, excluding energy and fresh foods, as well as inflation excluding only energy goods, continues to decelerate (both from +4.2% in October to +3.6%).

After hitting zero in October, the annual price change for goods turns negative (-1.4%), while services remain positive, though further slowing down (from +4.1% to +3.7%). This widens the inflationary gap between the services and goods sectors to +5.1 percentage points, up from +4.1 in October.

Prices for food, household, and personal care items continue to slow down on an annual basis (from +6.1% to +5.4%), along with high-frequency purchase products (from +5.6% to +4.6%).

The monthly decrease in the overall index is primarily driven by lower prices for unregulated energy (-3.8%), recreational and cultural services (-1.3%), transport-related services, and regulated energy (-0.7% for both). These effects are partially offset by an increase in prices for unprocessed foods (+0.8%).

The accumulated inflation for 2023 stands at +5.7% for the general index and +5.1% for the core component.

The Harmonized Index of Consumer Prices (HICP) decreases by 0.6% on a monthly basis and increases by 0.6% year-on-year, further decelerating from October’s +1.8% (preliminary estimate was +0.7%).

The National Consumer Price Index for blue-collar and white-collar workers’ families (FOI), excluding tobacco, records a 0.4% decrease on a monthly basis and a 0.7% increase year-on-year.

Commentary: In November, inflation drops to 0.7%, returning to levels close to those in February 2021 (+0.6%). The continued decline in the inflation rate is still influenced by the favorable trend in energy prices, which show a significant downturn on a monthly basis in November. The deceleration of inflation is also attributed to the dynamics of prices for certain types of services (recreational, cultural, and personal care, as well as transportation) and the new slowdown in Food prices (+5.8%), particularly the processed component, which puts a brake on the annual growth of the “grocery basket” prices (+5.4%). Finally, core inflation stands at +3.6% in November (down from +4.2%).