OECD-wide annual inflation held steady at 4.1% in July 2026, following a decline in June, as increases in 13 member countries were largely offset by declines in 14 others, with 11 more remaining stable.

Energy inflation stayed above 10% for a fourth consecutive month, reaching 11.6%, while core inflation (excluding food and energy) remained flat at 3.6%. Food inflation eased to 3.2% from 3.4% in June, with 23 OECD countries recording declines, including drops of 2 percentage points or more in Greece, Hungary, and Latvia.

G7 inflation was unchanged at 3.0%, though energy costs rose to 12.2% from 11.8% in June. Germany saw a 0.5 percentage point increase following the end of a fuel price subsidy on June 30, while the UK jumped 4.1 points after a rise in its energy price cap. Japan was the only G7 economy with energy inflation not near or above 10%, though it turned positive for the first time since November 2025.

Euro area inflation rose to 3.0% in July from 2.8%, driven by energy prices outweighing a 0.4-point drop in food inflation; core inflation held at 2.5%. Eurostat’s flash estimate for August points to a further rise to 3.2%, with energy inflation surging to 14.3%.

G20 inflation slipped to 3.9% from 4.1%, with China’s rate halving to 0.5%. As energy costs continue to drive divergent national trends, employers and benefits providers should watch for renewed pressure on wage negotiations and cost-of-living adjustments heading into year-end.