High Electricity Costs Keep Inflation at 3.2 Percent in February

Inflation in Austria remains high, especially compared to the Eurozone. Inflation in this country was 3.2 percent in February, the same as in January 2025. Electricity, in particular, increased significantly in price compared to the previous year. Inflation in the Eurozone fell slightly more in February than initially expected. Consumer prices rose by 2.3 percent compared to the same month last year.

Energy and Housing Were Main Price Drivers

The harmonized inflation rate at the European level was 3.4 percent in Austria in February. The increase in prices for housing, water, and energy by an average of 5.2 percent influenced the inflation rate by plus 1.06 percentage points, making it the most important driver of inflation compared to the previous year, according to the figures presented by Statistics Austria on Wednesday.

Household energy prices rose by 8.0 percent year-on-year and impacted the inflation rate by plus 0.53 percentage points. Gas prices in February were only 12.3 percent below the previous year's level because higher network charges, natural gas levies, and an increased CO2 tax have been in effect since January. Electricity prices remained consistently high, 35.7 percent higher in February than a year ago. District heating prices rose by 0.1 percent in February. Prices for solid fuels (minus 11.4 percent), on the other hand, continued to dampen the inflation rate, as did heating oil (minus 6.5 percent).

Rent Increase Stronger Than Overall Inflation

Rents (including new leases) rose by 4.4 percent, with their impact on overall inflation amounting to plus 0.24 percentage points. Prices in restaurants and hotels were increased by an average of 6.0 percent. The price increases for food and non-alcoholic beverages were 2.6 percent.

Transport prices rose by an average of 0.8 percent, significantly less than in January (+2.4 percent). Fuel prices were 3.6 percent lower in February than a year ago. Airfares increased by 13.7 percent year-on-year, car repairs by 3.6 percent, and used cars by 4.7 percent.

Daily Shopping Becomes More Expensive

The price level of the micro basket, which reflects daily shopping and predominantly contains food, but also includes daily newspapers or coffee at a café, rose by 3.9 percent in February compared to the previous year. The price level of the mini basket, which represents a weekly shopping trip and includes not only food and services but also fuels, increased by 2.6 percent year-on-year.

A look beyond the domestic borders can make one envious. In the Eurozone, the inflation rate has decreased slightly more than expected. Consumer prices increased by 2.3 percent in February compared to the same month last year, as reported by the statistics office Eurostat on Wednesday in Luxembourg. In January, the rate was still at 2.5 percent. Previously, the inflation rate had risen for four consecutive months.

Highest Inflation in Estonia, Lowest in France

The still high annual inflation rate is mainly due to significant price increases for services. Food, alcohol, and tobacco also became more expensive. Looking at individual countries, Estonia recorded the highest price increase rate with a plus of 5.1 percent. The lowest inflation was in France with a plus of 0.9 percent.

Compared to the previous month of January, consumer prices in the Eurozone rose by 0.4 percent in February. This figure was also slightly revised downwards.

Core inflation, excluding volatile prices for energy, food, and luxury goods, fell from 2.7 to 2.6 percent. Core inflation reflects the underlying inflation and, according to many economists, better represents the inflation trend than the overall rate. On a monthly comparison, core inflation in the Eurozone was at 0.5 percent.

(APA/Red)

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