Inflation in Bulgaria experienced a significant slowdown in September, dropping to 1.2% from 2.1% in August, marking the lowest rate since March 2021, according to the National Statistical Institute (NSI). Compared to August, a deflation of 1% was recorded, following a slight rise of 0.1% in the consumer price index during the previous month.

The notable decline in annual inflation was attributed to slower price increases in healthcare, which saw a rise of 1.8% compared to 2.3% in August, and in the restaurant and hotel sectors, where prices grew by 7.2%, down from 7.9% a month earlier. Additionally, transportation costs fell by 4.7%, a sharper decline than the more modest 0.2% drop recorded in August. The "entertainment and culture" sector also saw a decrease of 1.4%, reversing a growth of 2.7% from the previous month.

Conversely, there was a slight uptick in inflation for food and non-alcoholic beverages, which increased by 2.4% compared to 2.3% in August. Similarly, prices for alcoholic beverages and tobacco rose slightly, from 5.5% to 5.6%. The most significant price drop in September was observed in the "entertainment and culture" category, which decreased by 13.7%. This was followed by declines in "restaurants and hotels" by 2.5% and "transport" by 2.0%.

On a monthly basis, the education sector saw an increase of 3.3% in prices, while "clothing and shoes" rose by 0.8%, "food products and non-alcoholic beverages" by 0.6%, and "alcoholic beverages and tobacco products" by 0.3%.

In terms of harmonized inflation, which aligns with common European standards, the Harmonized Index of Consumer Prices (HICP) recorded a monthly increase of 1.1% in September. Year-on-year, harmonized consumer inflation slowed to 1.5% from 2.4% in August. This index serves as a comparative measure of inflation among EU countries and is crucial for assessing price stability, particularly in relation to Bulgaria's Eurozone accession.

The price index for a small consumer basket remained stable in September, showing a 0.6% increase since the beginning of the year. For the lowest 20% of households, the most significant monthly price increase in September was seen in food products, rising by 0.5%, while services went up by 0.1%. In contrast, prices for non-food goods decreased by 0.8%.