It has now been officially confirmed that June was the month with the highest inflation since mid 1985. The Spanish National Institute of Statistics (INE) has published that prices rose by 10.2% last month. With this, the psychological threshold of double digits has been exceeded.
The course of the price increases does not correspond to the forecasts made by governments and economists only two months ago. Moreover, it seems that the price increases are far from over.
The INE already expressed its expectations for the inflation rate a fortnight ago. And as the institute announced two weeks ago, fuel and food are the two categories that have risen the most over the past year. Diesel has risen by more than 42% in the past year and petrol has become 34% more expensive. In June alone, the price rose by 10%. This means that fuels have now replaced electricity as the main driver of price increases, although electricity is still much more expensive than a year ago. According to the INE, the price has risen 33% in the past year.
What is worrying is the rise in food prices. In general, they have already increased by 13.3%. Pasta, olive oil, butter, milk, eggs and salads are 20% more expensive than last year. This results in a rise in core inflation to 5.5%, the highest level in more than two decades.
Tourists pay more
On top of all this, just before the summer holidays, prices for tourists are rising. These also contribute to these historical inflation figures. According to the INE, hotel prices rose by 45% in June compared to last year. And package holidays have increased by 17% in the last month alone.
More than €3,500 in extra costs per family
The rise in inflation will have a direct impact on the pockets of families, who on average will have to spend €3,552 more of their annual budget for the same products. These are the additional costs of the price rises for the expenditure of the average household, measured according to data from the INE budget surveys.
More than half of the extra costs are for housing costs such as electricity, gas or rent, an item that has risen 19% in the past year and for which almost €1,900 has to be paid. On food, the second most expensive group, families spend €620 more per year. Transport costs have also risen by almost €620 per year.