FX.co ★ Iceland Inflation Picks Up to 4.1% in September

In September 2025, Iceland experienced an increase in its annual inflation rate, reaching 4.1%, up from a three-month low of 3.8% recorded in August. Significant upward pressure was observed in several categories: food and non-alcoholic beverages saw a rise to 6.1% from 5.5% in the previous month; housing and utilities increased to 6.5% from 6.4%; and the recreation and culture sector rose to 2.9% from 2.6%. Additionally, the category of miscellaneous goods and services experienced a slight increase to 4.3% from 4.2%, while prices for hotels, cafés, and restaurants sharply rebounded, jumping to 5.6% from a previous decline of 0.2%. Meanwhile, some easing was recorded in price growth for transport, which edged down to 1.1% from 1.2%, and health, which saw a decrease to 2.6% from 2.7%. Notably, costs in clothing and footwear fell to -0.2% from 1.8%, and furnishing, household equipment, and other items declined slightly to -0.6% from -0.7%. On a monthly scale, consumer prices saw a marginal increase of 0.1% in September, rebounding from a 0.2% decline in the previous month.