New Wifo forecast

Why prices are continuing to rise faster here

Although inflation slowed to 2.9 percent in July according to the flash estimate, the road to the inflation target of two percent is a rocky one. Wifo expert Josef Baumgartner explains when the situation will finally normalize and why inflation in Austria continues to be higher than in the eurozone.

At 2.9 percent for July, inflation is back below three percent for the first time in three years. Previously, the last time it was 2.9% was in July 2021 - and after that, prices rose sharply for a long time (see chart), especially after the start of the war in Ukraine in February 2022. The sole inflation record was in January 2023 with an inflation rate of 11.2%. Overall, we will have to pay around a quarter more on average for goods and services this year than in 2020. But when will "normality" return?