The sharp drop in inflation to 1.8% in September from 3.1% in August, according to preliminary Eurostat data, marks the first piece of positive news on prices in some time. Greece fell below the eurozone average of 2.2%—something rare in recent years.

The decline was driven mainly by energy, where prices fell 3.7%, and by services, which continued to rise but at a slower pace than in August. Food inflation also eased, though prices remain high.

Despite the good news, inflation’s impact is far from gone. Since 2019, food prices have risen by roughly 33% cumulatively, meaning that even with slower increases, households still face significant pressure.

In supermarkets, IELKA measured inflation at just +1.6% in August, with price cuts in items such as detergents and paper goods but increases in fresh meat. Consumers are buying less overall and shifting toward private-label products.

Supermarket price cuts

In an effort to curtail food prices, Greek authorities announced reductions on around 1,000 supermarket products, with at least 60 suppliers participating and discounts starting at 5%. The initiative aims to extend beyond Christmas, but analysts say it will not significantly alter the overall inflation rate.

Services and housing costs

Service costs continue to rise, fueled by strong tourism and soaring rents, keeping the category above overall inflation. The Bank of Greece expects rent pressures to persist, slowing disinflation in the coming years.

Forecasts point to lower inflation rates ahead, but with variations in magnitude. The Bank of Greece projects 3.1% in 2025 and 2.6% in 2026. The European Commission sees 2.8% in 2025 and 2.3% in 2026, while the IMF expects 2.4% in 2025. The IOBE think tank is more optimistic, predicting 2.0% in 2025 and 1.6% in 2026.