Greek Economy Breaths Easier: Inflation Slows to 1.9% in September

Significant Drop in Overall Inflation

Greece’s consumer price index (CPI) slowed sharply to 1.9% in September, down from 2.9% in August and 2.9% in September 2024, according to the latest data from the Hellenic Statistical Authority (ELSTAT).

This decline is largely driven by falling energy and food prices, offering some relief to households that had faced mounting expenses in previous months.

Falling Energy and Food Prices

Electricity prices dropped by 3.7% and natural gas by 10.2%, while staple food items, such as olive oil, saw an even steeper decline of 37.1%. These reductions contributed significantly to the overall slowdown in inflation, mitigating the impact of price hikes in other sectors.

Rising Costs in Everyday Goods and Services

Despite the overall easing, inflation pressures remain high for several categories:

• Food and beverages: Coffee (+19.8%), chocolate (+22.2%), meat (+8.4%), fish (+6.2%)
• Clothing and footwear: +5.2%
• Housing: Rent prices surged 9.9%, particularly in urban areas
• Transport and travel: Air fares increased 12.6%, holiday packages +6.7%
• Healthcare: Health insurance premiums rose 7%

These increases highlight that, while energy and some food costs are declining, households still face considerable pressure from other everyday expenses.

Monthly Increases Add Pressure

On a month-to-month basis, September recorded further price increases in essential items:

• Beef: +2%
• Lamb and goat: +2.8%
• Fresh vegetables: +2.1%
• Housing rents: +0.5%

This indicates that, even as overall inflation slows, pressures on essential goods remain persistent.

Economy in a Transitional Phase

The combination of declining energy prices and selective food deflation with rising costs in other sectors suggests a corrective phase in the market. Analysts note that stabilizing inflation around 2% will depend on international energy prices, domestic agricultural production, and the cost of services.

Policy measures targeting vulnerable households are essential to ensure that the slowdown in inflation translates into real financial relief for Greek citizens.