FX.co ★ Inflation in major European countries jumps to multi‑year highs on fuel prices

Inflation in leading eurozone countries has risen to its highest level in years following another spike in energy prices. Bloomberg reports that September readings in Germany, France, Italy, and Spain significantly exceeded economists’ forecasts. Prices rose most sharply in Spain, where inflation reached 5%, the highest level since early 2023. Other key countries also outpaced analysts’ projections.

The main driver of the price rise was a rapid increase in the cost of automotive fuel and motor oils. According to Eurostat, retail fuel prices in the European Union jumped 23.8% year-on-year by the end of summer. Gasoline increased most in Bulgaria, but the surge hit drivers across the bloc. Experts warn that high energy costs could push overall eurozone inflation toward 4% by year‑end.

The new wave of higher prices complicates policymaking across the region. Rising fuel costs automatically increase transportation expenses, which leads to higher food and industrial goods prices on store shelves. For the central bank, which had expected a quick normalization, this creates the risk of inflation becoming more entrenched, and for European households, it means further erosion of real incomes.