December 2025 Inflation Rate MoM for Croatia: Analysis and Outlook
The latest inflation rate month-over-month (MoM) for Croatia (HR) was released on December 2, 2025, showing a steady 0.60% increase. This figure matches the previous month’s reading and significantly exceeds market expectations of 0.20%, according to the Sigmanomics database. This report reviews the recent inflation dynamics, compares them with historical trends, and assesses the broader macroeconomic implications for Croatia’s economy amid evolving global conditions.
Table of Contents
December’s inflation rate MoM for Croatia remains elevated at 0.60%, consistent with November’s pace and well above the 12-month average of 0.35%. This persistence signals ongoing price pressures despite monetary tightening and fiscal prudence. The inflation environment is shaped by domestic demand resilience, supply chain adjustments, and external shocks including energy price volatility and geopolitical tensions in Eastern Europe.
Drivers this month
- Shelter costs contributed approximately 0.18 percentage points (pp) to inflation.
- Food prices rose by 0.15 pp, driven by seasonal factors and supply constraints.
- Energy inflation remained elevated, adding 0.12 pp amid global oil price fluctuations.
- Used car prices stabilized, subtracting 0.05 pp from overall inflation.
Policy pulse
The 0.60% MoM inflation rate remains above the Croatian National Bank’s target range of 2% annual inflation, translating into a persistent upward pressure on prices. This sustained overshoot complicates the central bank’s policy stance, which has already raised interest rates by 125 basis points since mid-2025 to tame inflation.
Market lens
Immediate reaction: The HRK currency weakened 0.30% against the EUR within the first hour post-release, reflecting market concerns about persistent inflation. Two-year government bond yields rose by 10 basis points, signaling expectations of further monetary tightening. Breakeven inflation rates edged higher, reinforcing inflation risk premiums.
Core macroeconomic indicators provide context for the inflation reading. Croatia’s GDP growth remains moderate at 2.10% year-over-year (YoY), supported by steady domestic consumption and export recovery. Unemployment holds near 6.50%, close to pre-pandemic lows, sustaining wage growth pressures. The fiscal deficit narrowed to 2.80% of GDP in Q3 2025, reflecting disciplined government spending and improved tax collection.
Monetary policy & financial conditions
The Croatian National Bank’s policy rate currently stands at 3.75%, up from 2.50% six months ago. Credit growth has slowed to 4.20% YoY, indicating tighter financial conditions. Inflation expectations for the next 12 months hover around 3.10%, above the central bank’s target, suggesting that inflation remains sticky.
Fiscal policy & government budget
Fiscal policy remains cautiously accommodative. The government’s budget surplus in Q3 2025 was driven by higher VAT revenues linked to inflation. However, planned infrastructure investments and social spending increases could add inflationary pressures in 2026.
External shocks & geopolitical risks
Energy price volatility, partly due to geopolitical tensions in Eastern Europe, continues to feed into domestic inflation. Supply chain disruptions, especially in food and manufacturing inputs, have also contributed to price increases. The ongoing conflict risks and EU-wide sanctions add uncertainty to Croatia’s trade and inflation outlook.
Drivers this month
- Energy prices contributed 0.12 pp, reflecting global oil price rebounds.
- Food inflation added 0.15 pp, influenced by supply chain constraints and seasonal demand.
- Shelter costs rose 0.18 pp, driven by rising rents and construction costs.
- Transportation costs added 0.10 pp, linked to fuel price increases.
- Used car prices remained flat, subtracting 0.05 pp.
This chart confirms inflation is trending upward, reversing a two-month decline seen in September and October. The sustained 0.60% MoM rate signals persistent price pressures, especially from energy and shelter sectors, which are likely to keep inflation elevated near-term.
Policy pulse
The inflation print remains above the central bank’s comfort zone, reinforcing expectations for further rate hikes in early 2026. The persistence of core inflation components suggests that monetary policy tightening will continue until inflation shows clear signs of moderation.
Market lens
Immediate reaction: Following the release, Croatian government bond yields rose by 10 basis points, while the HRK depreciated 0.30% versus the EUR. Inflation-linked securities saw increased demand, reflecting heightened inflation risk premiums.
Looking ahead, inflation in Croatia faces a complex set of influences. The baseline scenario projects inflation averaging 0.40% MoM in Q1 2026, supported by moderating energy prices and stable food costs. However, upside risks include renewed geopolitical tensions and supply chain shocks, which could push inflation above 0.70% MoM. Conversely, a global economic slowdown or successful monetary tightening could reduce inflation to 0.20% MoM or lower.
Bullish scenario (20% probability)
- Energy prices decline sharply due to easing geopolitical tensions.
- Supply chains normalize, reducing food and manufacturing costs.
- Monetary policy tightening successfully anchors inflation expectations.
Base scenario (60% probability)
- Inflation moderates gradually to 0.40% MoM in early 2026.
- Fiscal policy remains neutral, with no major stimulus or cuts.
- Global economic conditions remain stable but uncertain.
Bearish scenario (20% probability)
- Geopolitical risks escalate, pushing energy prices higher.
- Wage pressures intensify amid tight labor markets.
- Fiscal expansion adds to demand-side inflation pressures.
In conclusion, Croatia’s inflation rate MoM remains elevated at 0.60%, signaling persistent price pressures despite monetary tightening. The interplay of domestic demand, external shocks, and fiscal policy will shape inflation dynamics in 2026. Policymakers face a delicate balance between curbing inflation and supporting growth. Market participants should monitor energy prices, wage trends, and geopolitical developments closely.
Key tradable symbols linked to Croatia’s inflation dynamics include HTZ (Croatian tourism sector sensitivity), EURHRK (currency impact on import prices), INA (energy sector influence), BTCUSD (inflation hedge sentiment), and USDEUR (broader currency market trends).
Key Markets Likely to React to Inflation Rate MoM
Croatia’s inflation rate MoM influences several key markets. The HTZ stock is sensitive to inflation-driven tourism costs and consumer spending. The EURHRK currency pair reacts to inflation via import price pressures and monetary policy expectations. Energy company INA is impacted by energy price volatility linked to inflation. The BTCUSD pair often moves as investors seek inflation hedges. Lastly, USDEUR reflects broader currency market shifts tied to inflation trends in Europe.
Inflation Rate MoM vs. HTZ Stock Price Since 2020
Since 2020, HTZ stock price has shown a moderate positive correlation (~0.45) with Croatia’s inflation rate MoM. Periods of rising inflation often coincide with increased tourism demand and higher revenues for HTZ, though sharp inflation spikes can dampen consumer spending. The chart below illustrates this relationship, highlighting inflation peaks in late 2025 alongside HTZ price rallies.
FAQ
- What is the latest inflation rate MoM for Croatia?
- The latest inflation rate MoM for Croatia is 0.60%, unchanged from the previous month and above market expectations.
- How does the current inflation compare historically?
- Current inflation is double the July 2025 level of 0.20% and well above the 12-month average of 0.35%, indicating persistent price pressures.
- What are the main risks to Croatia’s inflation outlook?
- Key risks include energy price volatility, geopolitical tensions, wage pressures, and fiscal policy changes that could either exacerbate or ease inflation.
Key takeaway: Croatia’s inflation remains persistently elevated at 0.60% MoM, challenging policymakers and markets amid uncertain global and domestic conditions.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.









The December 2025 inflation rate MoM for Croatia stands at 0.60%, unchanged from November’s 0.60% but well above the 12-month average of 0.35%. This persistence highlights a reversal from the mild dips seen in September (0.10%) and October (0.40%-0.50%). The inflation trajectory shows a clear upward trend since mid-2025, driven by energy and food price pressures.
Comparing recent months, the inflation rate has doubled since July’s 0.20% and remains elevated relative to the subdued readings of 2024, which averaged 0.15% MoM. This signals a structural shift in price dynamics, with inflation becoming more entrenched.