MADRID – Inflation in August in Spain increased by one-tenth to 10.5% compared to the estimate at the end of August. The highest food prices since 1994 are recorded.
Actual inflation fell in August, but the drop was three-tenths instead of the predicted four-tenths. This was due to the variation in fuels. Moreover, it is evident from the final data of the consumer price index CPI for August published by the Spanish statistical office INE.
The rise in food prices, the highest in the historical series, is a cause for concern. Inflation is forecast to follow this slowing path in the coming months, falling below the double-digit barrier.
The energy crisis is the main cause
The energy crisis is the main cause of the price increases. Analysing the CPI data from recent months, inflation spikes were recorded in March, when Putin started the war. And again in June, when Russia cut gas supplies to Europe.
Highest inflation in July at 10.8%
The data for August are lower than those for July, when the CPI was 10.8%, the highest level since September 1984. However, all in all, it is the month of August with the highest year-on-year price increase in the past decade.
Food and electricity are more expensive again
The transport group is putting the biggest brake on the decline with a rate of 11.5%. That is four and a half points lower than the previous month. Moreover, it is due to cheaper fuels and lubricants, compared to the increase recorded in August 2021.
Especially meat, bread, grains, milk, cheese and eggs are more expensive
By contrast, electricity and food prices rose in August. The latter registered an annual increase of 13.8% in August, three tenths higher than in July and the highest since the start of the series, in January 1994. Particularly noteworthy is the increase in the price of meat, bread and cereals and milk, cheese and eggs.
In the ‘residential’ group, the annual rate rose by almost two points in August compared to the previous month, to 24.8%. That was due to the rise in electricity prices. Also, in the past year;
- heating, lighting and water have become 47.2% more expensive
- oils and fats have increased their prices by 24%
- eggs are 22.4% more expensive
- milk costs 25.6% more
- cereals are 21.7% more.
In the annual rate, the elements that increased the most in August were liquid fuels (79.1%), other oils (71.2%), electricity (60.6%), flour and other grains (39%) and butter ( 31.8%). Meanwhile those that decreased the most were tolls and parking (20.5%), mobile phone services (6.3%), mobile phone equipment (5.1%), audiovisual equipment (4.9%) and personal computers (4.6%).
Core inflation 6.4%
The INE maintains core inflation at 6.4% excluding fresh food or energy, which is three-tenths more than in July.
Without taking into account the reduction in the special levy on electricity and the variations in other levies, the inter-annual CPI reached 11.2% in August, seven-tenths above the general rate of 10.5%.
On a monthly basis (August to July), the CPI registered an increase of three-tenths (two more than expected), compared to the decrease of three-tenths in July and the increase of 0.5% a year earlier.
Biggest rise on the islands
The annual percentage rate of CPI decreased in August compared to July in 13 Autonomous Communities, increased in two and remained stable in the remaining two. The largest declines occurred in Castilla-La Mancha, with a decline of 0.6 points, and in Asturias and Galicia, with declines of 0.5 points in both.
The increases were recorded in the Balearic Islands and the Canary Islands, with increases of 0.4 and 0.1 points respectively.
Also read: July inflation in Spain highest in 40 years
