Consumer Price Index rises to highest level since April 2023

The Consumer Price Index (CPI) rose 0.3% in May compared to the previous month and raised its interannual rate three tenths, to 3.6%, its highest level since April 2023, due again to the increase in the price of electricity, after the IVA reduction was withdrawn thus increasing the price, according to the final data published this Thursday by the National Institute of Statistics (INE), which confirms those advanced at the end of last month.

For its part, the price of food and non-alcoholic beverages moderated its year-on-year increase in May to 4.4%, three tenths less than in April, due, for the most part, to the increases in the prices of fruits and meat, as well as the decrease in the prices of oils and fats, compared to the increase they experienced in May of last year.

The Ministry of Economy, Commerce and Business has highlighted that this rate of 4.4% in the food group is one of the lowest since November 2021 and implies a reduction of more than 12 points in the last year.

The Department led by Carlos Cuerpo has attributed the rise in inflation in May to 3.6% to the base effect in electricity and fuels and has highlighted that inflation continues to reflect the capacity of the Spanish economy to make economic growth compatible “with a moderation of prices and maintenance of support for the most vulnerable.”

With the increase in the interannual CPI in the fifth month of the year, inflation is chaining three consecutive months of increases after the increases of four and one tenth experienced in March and April, respectively.

The May rebound puts inflation at its highest level since April 2023, when the CPI exceeded 4%.

Core inflation (without unprocessed food or energy products) rose one tenth in May, to 3%, a rate six tenths lower than the general CPI.

In this sense, the Ministry of Economy has indicated that this rebound in the underlying is due to the increase in the prices of services related to tourism (tourist packages, air passenger transportation, accommodation services, etc.)

In monthly terms (May over April), the CPI increased 0.3%, its smallest increase since January, after raising the prices of clothing and footwear due to the new spring-summer season (+2.3%), services accommodation and catering, and housing, due to electricity prices. On the other hand, the transport group cut its monthly rate by 0.6% due to lower fuel prices compared to the previous month.

In the fifth month of the year, the Harmonised Consumer Price Index (IPCA) placed its interannual rate at 3.8%, four tenths more than in April. For its part, the monthly variation of the IPCA was 0.2%.