Emre Yumlu 
According to the latest data published by Eurostat, the statistical office of the European Union, the annual inflation rate in the Euro area was 1.9% in May 2025. This marks a decline from 2.2% in April 2025. In the same month last year, the inflation rate stood at 2.6%.
Across the European Union, the annual inflation rate was 2.2% in May, down from 2.4% in the previous month. In May 2024, the inflation rate for the EU was 2.7%.
Countries with the Lowest and Highest Inflation Rates
In May, the lowest annual inflation rates were recorded in Cyprus (0.4%), France (0.6%), and Ireland (1.4%). On the other hand, the highest inflation rates were seen in Romania (5.4%), Estonia (4.6%), and Hungary (4.5%).
On a monthly basis, annual inflation fell in 14 member states, remained stable in one, and rose in 12.
Main Contributors to Inflation
According to the May 2025 data, the largest contribution to Euro area inflation came from the services sector (+1.47 percentage points). This was followed by food, alcohol, and tobacco (+0.62 pp), non-energy industrial goods (+0.16 pp), and energy, which had a negative impact (-0.34 pp).
In particular, there was an increase in the contribution from processed food, alcohol, and tobacco, while the decline in energy prices stood out as a disinflationary factor.
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