Luxembourg’s annual inflation rate rose to 3.1% in April 2026, compared with 2.4% in March, pushing the country closer to its next automatic wage indexation.
Statec reported that the six-month average of the index linked to the base of 1 January 1948 increased from 1,035.12 to 1,038.35 points in April. The next wage indexation will be triggered when the value reaches 1,038.79, meaning when 2.5% inflation has accumulated since the last indexation.
To date, 2.46 percentage points of inflation have accumulated, leaving the threshold within close reach. Statec will publish its first estimate of the annual inflation rate for May on 29 May and will confirm, if applicable, whether the next wage tranche has been triggered.
Energy drives the jump
The acceleration in inflation was largely driven by energy. Statec stated that the energy component accounted for 42% of inflation in April, after fuel and heating oil prices rose sharply.
The energy aggregate increased by 9.1% compared with March and by 17.7% year on year, as the repercussions of the war in Iran continued to put pressure on energy prices in Luxembourg. Heating oil recorded the steepest rise, with prices jumping by 23.0% over one month and by 75.5% on an annual basis. Fuel prices also increased further, rising by 11.1% in April after a 15.6% monthly increase in March. Over one year, fuel prices were up 28.8%.
The price per litre of diesel rose by 15.1% in one month, while petrol increased by 8.1%. Gas and electricity prices remained unchanged in April, Statec noted.
Food adds pressure
The food aggregate, including alcohol and tobacco, increased by 2.6% compared with April 2025. Statec reported marked annual increases for chocolate, up 9.3%, fresh meat, up 7.0%, and coffee, up 8.7%. By contrast, vegetable oil prices declined by 4.7% and pasta fell by 4.2%.
Alcoholic beverages rose by 1.5% over one month, driven by wine, up 2.1%, and spirits and liqueurs, up 1.6%. Beer prices declined by 0.3% compared with March. On an annual basis, alcoholic beverages rose by 1.1%.
Services and goods
Services prices increased by 2.3% year on year in April, down from 2.5% in March. Statec attributed the slowdown mainly to annual declines in package holidays and airline tickets, as well as a decrease related to financial services.
Prices still rose for childcare facilities, after-school care centres and restaurants. The restaurant sector recorded an increase of 0.7% over one month and 3.6% year on year.
Non-energy industrial goods showed the lowest annual increase, at 1.0%. Water supply recorded the strongest annual change in this category, rising by 10.4% year on year, while book prices rose by 3.7% over one month. Plants and flowers declined by 3.1% compared with March and small household appliances fell by 2.6%.
Underlying inflation
While headline inflation rose to 3.1%, the overall index excluding energy declined from 2.1% to 1.9%, showing that the April acceleration was driven mainly by energy rather than broad-based price pressure. The overall index for April, expressed on a 2025 base of 100, stood at 102.65 points.
For households and employers, the key question now is whether May’s figures will push the wage indexation mechanism over the line.
