Energy Price Surge Drives Eurozone Inflation to 3.3% in August

The Eurozone inflation rate rose to 3.3% in August 2026, up from 2.9% in July, according to a flash estimate from Eurostat. The increase was largely driven by energy prices, which surged amid the war in Iran and disruption to shipping through the Strait of Hormuz. Energy prices rose by 14.3% in the year to August.

Leo Barincou, senior economist at Oxford Economics, said: 'This was driven by a rebound in fuel prices following the renewed closure of the Strait of Hormuz, while underlying price pressures remained contained as services inflation came down.'

The European Central Bank's 2% target is now well above the current rate. Markets expect the ECB to raise interest rates by 0.25 percentage points at its meeting on September 10th.