Inflation, hit by 1796 euros per family in 2023

In the 2023 on average consumer prices record a growth of the 5.7%, a marked slowdown from 8.1% in 2022. This is what emerges from Istat’s preliminary estimates which indicate inflation still declining in Decemberwhich goes down to +0.6% yearly compared to +0.7% in November.

Inflation at 5.7% in 2023

Specifically, according to provisional data, in the last month of the year just ended, the national consumer price index for the entire community (Nic), including tobacco, increased by 0.2% on a monthly basis and of0.6% on an annual basis. A trend that “is mainly affected by the easing of tensions on the prices of energy goods”, explains Istat. Prices in food sector they highlight instead an acceleration of the average annual growth (+9.8%, from +8.8% in 2022), despite the attenuation of their trend dynamics, highlighted in the second half the year.

The numbers

“Still positive signs on the front ofinflation for families: as Istat reports, in fact, in December there was a new slowdown in prices, mainly due to energy goods, which in this phase have calmed down the basket, and to processed foods. However, the prospects for the current new year still remain uncertain: purchasing power and savings are increasing, a sort of unexpressed potential energy which, however, does not benefit consumption, which remains the real patient of the domestic economy”, he writes Confessors in a note underlining that “the slowdown in inflation from the second half of 2023 should not, therefore, represent an episodic event, above all we can observe an easing of tensions on the supply side: raw material prices are slowing down, the situation is recovering in international supply chains. We should therefore proceed towards a normalization of prices during 2024, although not reaching 2%. And the crux of the ECB’s monetary policy decisions remains: the hope is that we will begin to reduce the cost of money which has a critical impact on families, in particular those with mortgages, and on businesses”.

In this scenario, “the ones that are of greatest concern are weak household consumption, which have a decisive impact on the overall growth of our economy and which are still in deficit compared to pre-covid levels, even if it is presumable to hypothesize that with the last quarter of 2023 the pre-health crisis levels can finally be exceeded”.

In 2023, a blow of over 1700 euros per family

“The rise in prices and tariffs which affected all sectors in 2023 cost on average 1,796 euro per family as a result of increased annual expenditure”, states Codacons, commenting on the inflation data released today by Istat.

With consumption being equal, an inflation rate of 5.7% translates into an increase in spending of +1,796 euros per household on an annual basis – explains Codacons – Considered the totality of Italian families, it is a maxi-punch of a total of 46.3 billion euros in a single year.

“The slowdown in inflation in the last period of the year can be attributed solely to the downward trend in energy goods, while for primary goods like food, price growth remains sustained – states President Carlo Rienzi – The contrasting measures adopted by the government, from the shopping basket to the billboards on average petrol prices, have not had the desired effects, and we hope that in 2024 they will introduce truly effective measures to counter speculation and price increases and protect citizens’ pockets”.

Prospects still uncertain

“Istat data on inflation for 2023 demonstrate how the price emergency is far from over in Italy, with families having to face a real blow last year. He affirmed itin Assoutenti, commenting on the numbers released today by Istat. “On the food front, the 2023 was a devastating year – explains the president Gabriele Melluso – For food and drinks alone, which recorded an increase in price lists of +10.1%, a family with two children found themselves spending an average of +812 euros, while the “typical” family ”, with the same consumption, suffered an increase in expenditure of +584 euros per year. The increases have weighed on primary goods that citizens cannot do without, forcing families to reduce consumption in other sectors, resort to savings to cover expenses or go into debt.”

“2024 must be the year of the turning point on the price front, and in this sense the Government must take action by fighting the speculations that lurk in the formation of retail price lists in all sectors” – concludes Melluso.

The National Consumers Union speaks of a flop compared to the anti-inflation quarter given that “the prices of food products and non-alcoholic drinks, i.e. of the goods affected by the Government’s initiativeor, instead of decreasing in price also in December they continued their upward trend, rising by 0.3% compared to November, after they had already risen by 0.4% compared to October”, says Massimiliano Dona, president of the National Consumers Union.

“As for average inflation as a whole, the +5.7% means that in 2023 a couple with two childrenhe spent 1608 euros more than in 2022, of which 147 for housing, electricity and fuel, 153 for transport, 777 for eating and drinking. For a couple with 1 child, the additional expense incurred in 2023 is equal to 1467 euros, 701 for food and drinks alone. On average for a family the price increase last year was 1177 euros, 570 to feed and quench their thirst. The record goes once again to large families with more than 3 children with a bump compared to 2022 equal to 1812 euros, 928 for food products and alcohol-free drinks” concludes Dona.

The commitment to support families continues

Federdistribuzione instead it confirms the commitment also in 2024. “The slowdown trend in price growth is confirmed in December as well. The ‘Anti-inflation Quarter’ initiative, cwhich ended in December and supported with a great sense of responsibility by the companies of Modern Distribution, it has produced positive effects in slowing down shopping cart prices and supporting food consumption. During the ‘Anti-inflation Quarter’, families particularly appreciated the Private Label (MDD) products, which guaranteed an always convenient and quality offer.

The commitment will continue in 2024 distribution companies in defending the purchasing power of families. We hope that industrial companies producing branded consumer goods will also contribute to this objective and responsibly intervene to reduce, where possible, the list prices of products. In the last two years, Modern Distribution has made a huge economic effort to combat inflation. It remains essential to support business growth and investment of the sector through regulatory interventions and simplifications, to continue generating benefits for families and the Made in Italy supply chains“, commented Carlo Alberto Buttarelli, President of Federdistribuzione.

Analysts’ comments

Inflation back above 2% soon

Looking ahead, overall inflation in the coming months “will continue to reflect the trend in energy pricesa, in turn influenced by the elimination of administrative measures introduced in the past to alleviate the impact of the surge in energy prices on household budgets. For example, in the retail gas market, in January the VAT applied to gas will be brought back to the normal rate of 22% (from the temporary 5%) and system charges, which were temporarily suspended, will be reinstated. Other prices, such as highway tolls, will also be increased, contributing to higher inflation. We already expect inflation to return above the 2% threshold in March, where it should stabilize for a few months. The risks with respect to this profile include on the one hand possible unfavorable geopolitical developments in the Red Sea and their impact on transport costs, and on the other hand greater downward pressures linked to possible negative surprises on the domestic demand front. For the moment we confirm our forecast of average Italian inflation at 2.2% in 2024″, he comments Paolo PizzoliSenior Economist at ING.