Inflation in the euro area keeps accelerating. Eurostat’s preliminary reading of the September consumer price index, published today, Friday, October 2, 2026, confirmed it.

The 3.8% year-over-year jump has reinforced fears that the European Central Bank (ECB) will be forced to raise eurozone interest rates again, after the two hikes it has already delivered this year.

Eurozone inflation hits 3.8% in September as energy prices surge 18.8%

Euro area inflation picked up further in September, running well above August’s 3.2%.

As expected, the main driver was energy, where prices jumped 18.8% year over year, up from +14.3% in August.

Price growth also firmed in services (+3.2%, versus +3.0% in August) and in food, alcohol and tobacco (+1.4%, versus +1.1%). Non-energy industrial goods rose 1.1%, slightly slower than August’s +1.2%.

Excluding the most volatile components, energy and food, core inflation in the euro area stood at 2.5% year over year. That is also clearly above the ECB’s 2% target.

National readings: Italy at 4.2%, Spain near 5%

At its latest meeting on September 10, the ECB announced the second interest rate hike of 2026. The 25-basis-point move lifted the deposit rate, the main refinancing rate and the marginal lending rate to 2.50%, 2.65% and 2.90%, respectively.

With eurozone inflation approaching 4%, pressure is building on the central bank (headquartered in Frankfurt) to tighten again. Even so, markets are still pricing in a deposit rate on hold at 2.50% at the next meeting in October, after the two hikes announced on June 11 and September 10, with a probability of about 71%.

The next hike is considered more likely at the Governing Council’s final meeting of the year, scheduled for December 17. The odds of a December move that would take the deposit rate to 2.75% hover around 65%.

A third hike by year-end looks plausible above all because of other data released this week that confirmed the surge in inflationary pressure. France’s harmonized inflation rate rose to 3.4% year over year in September, from 2.6% in August. Germany’s climbed to 3.3%, from 2.9% in August.

Italy fared worse, with inflation jumping to 4.2%. Spain’s reading was the biggest shock, at around 5%.

What economists expect: a third hike, but not two more in 2027

Economists at Dutch bank ING back the call for a third tightening this year. They cite oil prices above $100 a barrel and an ECB that remembers its historic mistake of 2022, when it reacted too late to that year’s inflation shock.

ING stressed that a December hike would nonetheless be “insurance” in nature, given the “growing risk of causing unwarranted damage to the economy.”

For the same reason, the bank considers the market’s outlook, which points to at least two more hikes in 2027, to be excessive. ING also does not share those expectations because it believes the ECB’s GDP growth forecasts are “very optimistic.” Its analysts say they wonder whether the negative growth impact from oil prices and higher interest rates could be larger.

On growth, Mario Draghi, the former ECB president and former Italian prime minister, has in recent hours urged ECB President Christine Lagarde not to raise rates too far.

Still, according to market bets, there is a 49% probability that the ECB will raise rates at its February 4, 2027 meeting, and a 40% probability that another hike will be announced after the March 18 meeting. In that case, the deposit rate would climb to 3.25%, 75 basis points above current levels.

Editor’s note

This article was originally published in Italian on money.it by Laura Naka Antonelli on October 02, 2026 as «Inflazione euro balza al 3,8%. Quante volte la BCE alzerà ancora i tassi?». It has been translated and adapted for an international audience by the Money.it International desk.