The overall rate rises six tenths since August and marks the highest level in three years. Spain registers the highest harmonised inflation of the major economies, at 5%, compared to Germany's 3.3%.
Eurozone inflation stood at 3.8% in September, its highest level in three years, according to data published by Eurostat. The figure exceeds August's 3.2% and analysts' forecasts, which anticipated a more moderate increase. The data, reported by moncloa.com, reignites the debate over interest rates at the European Central Bank (ECB).
The energy component was the main driver of the rise: energy prices increased by 18.8%, nearly five points higher than in August. This surge is attributed to the closure of the Strait of Hormuz, the conflict in the Middle East, Russia's war against Ukraine, the ban announced by Donald Trump on exporting US diesel to Europe, and lower-than-expected gas storage.
The other components moved more moderately. Services rose by 3.2%; food, alcohol, and tobacco increased by 1.4% (up from 1.1% in August); and non-energy industrial goods rose by 1.1%. Core inflation, which excludes energy and fresh food, remained at 2.5%.
Spain recorded the highest harmonised inflation among the four major economies: 5%, ahead of Italy (4.1%), France (3.4%), and Germany (3.3%). This differential has a direct impact on variable-rate mortgages, collective bargaining negotiations, and the electricity bills of Spanish households. Additionally, it tightens the political margin for Moncloa, which defends in Brussels a fiscal design that does not penalise growing countries.
The energy shock does not recognise borders, but punishes those who depend on imported gas more: that is why Spain leads the table and Germany avoids it.
The ECB President, Christine Lagarde, had downplayed this week the impact of energy prices on its strategy and was confident that the rise in bond yields would curb expansion and limit the transmission of the shock to overall prices. The September data calls that thesis into question.
Markets are already pricing in a new increase of 25 basis points before the end of 2026. The closest precedent is the energy crisis of 2022, when inflation exceeded 10% and the ECB executed ten consecutive rate hikes. That remedy worked, but left a hangover of weak growth and a more expensive debt bill for southern Europe.
The next meeting of the ECB Governing Council, where the decision on whether this increase materialises will be made, will be on 15 October. The definitive inflation figure for September will be known on 17 October.
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