Italian consumer price index remains stable sequentially in July

Italian consumer price index came in stable on a sequential basis in July. On a year-on-year basis, the consumer price index came in at 0.4 percent, down from 0.7 percent in the prior month and flash estimate of 0.5 percent.

The deceleration of growth on annual basis of All items index was especially due to the trend reversal of prices of Regulated energy products, that was just slightly countered by the speed-up of prices of Unprocessed food and of Services related to transport and by the reduction in the extent of price decrease of durable goods.

The core inflation, which excludes energy and unprocessed food was 0.5 percent and inflation excluding energy was 0.6 percent. The zero variation on monthly basis of All items index was because of opposite dynamics: the decrease of prices of Regulated energy products, of unprocessed food, and of non-regulated energy products countered by the increase, impacted by seasonal factors, of prices of services related to recreation, including repair and personal care and of services related to transport.

The annual pace of change of prices of goods came in at -0.1 percent, down from 0.5 percent in the prior month. The change of prices of services was 1 percent. Therefore, the inflationary gap between services and goods was 1.1 percentage points. Prices of grocery and unprocessed food dropped by 0.2 on monthly basis and increased by 0.6 percent on annual basis.

The Italian harmonized index of consumer prices dropped 1.8 percent sequentially and rose 0.3 percent year-on-year. The fall on monthly basis was mainly because of the beginning of the summer sales of clothing and footwear.