Austria Inflation Drops Below 4% as Price Pressures Ease

Inflation in Austria eased notably in December, with the annual rate falling to 3.8%, marking the first drop below 4% since mid-2025 and signaling easing price pressures.

Official data showed slower price growth toward year-end, particularly in the energy sector, while lower fuel prices helped curb inflation in Austria despite persistently high electricity costs.

According to the statistics office, services remained the main inflation driver, with service prices rising by 4.4%, alongside faster increases in food, beverages, and tobacco prices.

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 indicated the end of a manufacturing slowdown, as industrial production posted strong growth, pointing to a stronger-than-expected economic recovery.