FX.co ★ Iceland Producer Inflation Slowest in Over a Year

In May 2025, Iceland experienced a modest 0.3% year-on-year increase in producer prices, significantly down from the 5.4% rise observed the month before. This marked the fourteenth consecutive month of increasing producer prices, yet it was the most modest rise in this trend. The reduction was primarily due to declines in the metal industry (-9.8% compared to 9.6% in April), exported products excluding marine products (-9.5% compared to 2.6%), and overall exported goods (-2% compared to 5.6%). Conversely, there was a noticeable acceleration in producer inflation for marine products (12.1% compared to 10.7%), food production (7.6% compared to 6.2%), and products sold within the country (5.4% compared to 4.6%). Additionally, price declines were less pronounced in other manufacturing sectors, with a slower decrease of -4% compared to -5.1% previously. On a month-to-month basis, producer prices fell by 2.3% in May, marking the most significant drop since April 2023, following a 0.8% decrease in the prior month.