Inflation in Europe: Which countries have the highest and lowest inflation rates?

Inflation in the EU has been gradually and consistently falling since its peak at 11.5% in October 2022. In January 2024, the annual inflation in the EU was 3.1%, down from 3.4% in December according to Eurostat, the statistical office of the EU. 

That was in sharp contrast to the same time last year when it was 10.0%.

At the same time, the eurozone area annual inflation rate was 2.8% in January 2024, down from 2.9% in December and considerably lower than the 8.6% seen in January 2023.

Falling inflation indicates that consumer prices are increasing more slowly than they were earlier, although they are still rising. Negative inflation, or deflation, happens when prices fall in an economy. In January, for example, energy prices in the EU were lower than a year earlier.

Eurostat's preliminary estimate, issued on 1 March, demonstrates that annual inflation in the eurozone area fell to 2.6% in February, down from 2.8% in January. However, it is still above the European Central Bank's (ECB) target inflation rate of 2%.

The inflation rate, measured by the Harmonised Index of Consumer Prices (HICP), largely differs across Europe. While it has been seen to cool in most of the EU countries, none of them showed a negative inflation figure in January year-on-year. The Eurostat's estimates for February do not show any sign for such a decline in any country yet.

Inflation hit its highest rate in the past four decades in October 2022. 

The COVID-19 crisis was followed by a significant surge in consumer prices as the Organisation for Economic Co-operation and Development's (OECD) report of 2023 showed. Prices began to rise in 2021 because of the rapid rebound from the pandemic and related supply chain bottlenecks.

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