Italian final HICP inflation for July seen at -0.1 pct

Italy’s final HICP inflation print for the month of July is likely to have remained the same as the flash estimate. According to a Societe Generale research report, the final HICP inflation figure is expected to have confirmed the flash reading of -0.1 percent in July. The flash reading had indicated that all major components, except non-energy industrial goods, contributed positively to the headline figure.

Energy prices continued to be flat on a month-on-month basis; however on an annual basis prices dropped 6.9 percent, as compared with 7.5 percent year-on-year drop in June. Meanwhile, food prices surged to 0.9 percent year-on-year from 0.5 percent year-on-year. This was due to considerably higher prices of unprocessed food.

In the meantime, core inflation continued to be stable at 0.5 percent year-on-year as prices paid for services rose to 0.8 percent on an annual basis from 0.5 percent. This countered the drag from the non-energy industrial goods prices that eased to 0.2 percent year-on-year from 0.5 percent due to summer sales of footwear and clothing.