Austria’s annual inflation rate accelerated to 3.2% in August 2026, up from 2.8% in July, according to preliminary estimates. The pick-up was driven largely by energy prices, which surged 10.0% year-on-year after a 5.7% increase in the previous month. Food, tobacco, and alcohol prices also returned to positive territory, rising 0.2% after a 0.1% decline in July. However, these gains were partly contained by the July 2026 reduction in VAT on basic foodstuffs, from 10.0% to 4.9%.
By contrast, inflation for manufactured goods eased, with prices rising 0.5% year-on-year compared with 0.8% in July. Services remained the largest contributor to overall inflation, despite a slight slowdown in price growth to 4.3% from 4.4% a month earlier. On a monthly basis, consumer prices increased 0.6% in August, following a flat reading in July.
