MADRID – Life remains expensive and is getting more and more expensive. Inflation in Spain rose to 2.3% year on year in July. An increase was mainly driven by a 10.8% increase in food prices.
This is according to data released on Friday by the Instituto Nacional de Estadística (INE). Underlying inflation, which excludes unprocessed food and energy products, rose 0.3 points to 6.2% year-on-year.
The main factors contributing to the increase in the consumer price index (CPI) are closely linked to tourism. A sector that is preparing for a full recovery in the summer season. Fruit prices increased by 11.6% and oils and fats by 20.4% in July this year, in contrast to the decline recorded in the same month of 2022.
Fuels cheaper than years ago
Fuels, which have had the most impact on the rise in headline inflation, have accelerated their price increase by two percentage points from the previous month, but are still 5.3% cheaper than a year ago. This is due to the €0.20 discount on petrol and diesel introduced by the government to mitigate the price increases of energy products caused by the conflict between Russia and Ukraine.
Prices for leisure and culture increased by 7.2%
In addition, leisure and culture prices increased by 7.2%, two points more than in June, due to the higher cost of tourist packages. National prices increased by 17.9% compared to a year ago and international prices by 17.8%. On a monthly basis, this is the biggest increase in July, up 24.3% from June prices. Meanwhile accommodation costs rose 10.8% from the previous month.
Harmonised CPI Spain is among the lowest in the EU
As for the harmonised CPI, an indicator that provides a common measure of inflation for comparisons with the European Union. This stood at 2.1%, five-tenths higher than in June. Although this is one of the lowest numbers in Europe, Spain has once again crossed the 2% threshold, a target set by the European Central Bank (ECB) for its monetary policy.
Inflation returns to the rising trend
With the final July data published by the INE, inflation is returning to an upward trend after two consecutive months of declines. These brought the CPI to 1.9% in June, the lowest level since March 2021. This return to the upward trend highlights that prices will continue to fluctuate throughout this year due to the base effects and various price increases that took place in the last months of 2022.