Inflation in Austria Falls Below 4% as Price Pressures Ease

Inflation in Austria continued its downward trend in December, falling to 3.8%, marking the first drop below 4% since July 2025 and signaling easing price pressures toward year-end.

Official data showed a slowdown in price increases, particularly in the energy sector, while lower fuel prices helped curb inflation despite persistently high electricity costs.

Austria’s statistics office noted that the services sector remained the main driver of inflation in Austria, with service prices rising by 4.4% in December, alongside faster increases in food, beverages, and tobacco prices.

Local economists expect inflation in Austria to continue declining in 2026, reaching a range of 2.5% to 2.6%, after averaging around 3.5% in 2025 due to elevated energy prices.

Meanwhile, industrial data signaled the end of the manufacturing downturn, with industrial production posting strong year-on-year growth, pointing to a stronger-than-expected economic recovery.