Iceland Inflation Picks Up to 4.1% in September

The annual inflation rate in Iceland rose to 4.1% in September 2025, from August’s three-month low of 3.8%. Main upward pressure came from prices of food and non-alcoholic beverages (6.1% vs 5.5% in August), housing and utilities (6.5% vs 6.4%), recreation and culture (2.9% vs 2.6%), and miscellaneous goods and services (4.3% vs 4.2%), alongside a sharp rebound in prices of hotels, cafés, and restaurants (5.6% vs -0.2%). In contrast, price growth eased slightly for transport (1.1% vs 1.2%) and health (2.6% vs 2.7%), while costs declined for clothing and footwear (-0.2% vs 1.8%) and furnishing, household equipment etc. (-0.6% vs -0.7%). On a monthly basis, consumer prices inched up 0.1% in September, following a 0.2% fall in the previous month.