PARIS - Year-on-year inflation in the OECD, as measured by the Consumer Price Index (CPI), decreased to 6.2% in September 2023 from 6.4% in August, following increases in July and August (Figures 1 and 3). Inflation fell between August and September in 27 OECD countries. By contrast, it rose in 8 OECD countries, with rises of around or more than one percentage point (p.p.) in Spain, Costa Rica (the only OECD country where headline inflation was negative), Slovenia, and Türkiye. Double-digit inflation was recorded in Türkiye, Hungary and Colombia.

Food inflation in the OECD slowed for the tenth consecutive month, reaching 8.1% in September, down from 8.8% in August. However, food inflation still exceeded 10% in 9 OECD countries. Energy inflation increased between August and September in 22 OECD countries but remained negative in the OECD as a whole. Inflation less food and energy (core inflation) moderated slightly to 6.6% from 6.8% in August.

In the G7, year-on-year inflation remained broadly stable, at 4.1% in September compared to 4.2% in August. Energy inflation turned positive for the first time since February 2023, mitigating the continued slowdown in food and core inflation. Germany registered a large fall in headline inflation from 6.1% in August to 4.5% in September, mainly driven by a sharp drop in energy inflation. This reflected a base effect as energy prices surged in September 2022 following the end of relief measures (the 9-euro public transport ticket and the fuel discount). In most other G7 countries, headline inflation was stable or declined slightly. In France, year-on-year energy inflation rose to 11.7% in September after 7.0% in August, reflecting in part the phasing out of the price shield. Non-food and non-energy items remained the main contributors to headline inflation in most G7 countries in September (Figure 2).

In the euro area, year-on-year inflation as measured by the Harmonised Index of Consumer Prices (HICP) dropped to 4.3% in September from 5.2% in August. Core inflation declined significantly to 4.5% in September, after sitting between 5.3% and 5.7% since the beginning of the year. Food inflation fell broadly at the same pace as in the five previous months, while energy inflation was negative for the fifth month in a row. In October, Eurostat’s flash estimate points to a further fall in year-on-year inflation in the euro area, to 2.9%, its lowest level since July 2021. Both energy inflation and core inflation in the euro area are estimated to have dropped again in October.

In the G20, year-on-year inflation declined to 6.1% in September 2023, down from 6.3% in August. It decreased in India and reached its lowest level since February 2022 in Indonesia and Saudi Arabia. Headline inflation rose in Argentina, South Africa and Brazil. In China, headline inflation continued to hover around zero.