Inflation in Spain Rises

The price of energy triggered inflation in April in Spain, causing the largest monthly rise since 2014. The INE today confirmed the annual rate of the CPI at 2.2%. The components that have risen the most compared to last year are electricity (+36.9), liquid fuels (+ 31.4%), gasoline (+ 20.2%) and diesel (+ 16.5%). However, the underlying index, which does not take energy and fresh produce into account, stands at 0%, the lowest level since 2014. Since 1986 there was no such divergence between the general price index and the underlying one.

The Consumer Price Index (CPI) rose 1.2% in April in relation to the previous month and placed its interannual rate at 2.2%, nine tenths above that of March (1.3%), according to the data published this Friday by the National Institute of Statistics (INE), which confirms the advanced data at the end of last month.

With this rebound, with which the annual CPI chains its fourth consecutive positive rate, inflation climbs to levels unknown for more than two years. In fact, such a high CPI rate had not been reached since October 2018, when it stood at 2.3%.

The sharp increase in prices in April has been mainly contributed by the rise in electricity prices and the maintenance of fuel prices, in contrast to the drops in April 2020. On the other hand, fruits and tourist packages became cheaper.

Prices within the housing group grow 10% annually
Specifically, the housing group raised its interannual rate by almost six points in April, to 10%, due to the rise in the price of electricity, while the transport group increased its rate by more than 3.5 points, to 7 , 4%, due to the stability of fuel prices for personal transport, compared to the decrease experienced in April 2020, in full house confinement.

On the contrary, the food group cut its interannual rate by more than one point, to 0.3%, due to the lower prices of fruits and the lower rise in the prices of legumes and vegetables and fish and shellfish compared to as of April 2020.

Among the decreases are also the leisure and culture group, which reduced its interannual rate by one point, to -1.2%, due to the lower cost of tourist packages, as well as hotels, cafes and restaurants, which cut five tenths its interannual rate, down to -0.5%, due to the fact that prices for accommodation services rose less this year than they did in April 2020.

The largest gap between underlying and the general index in 35 years
For its part, core inflation (excluding non-processed food and energy products) placed its interannual rate in April at 0.0%, three tenths less than in March and a rate more than 2 points lower than the general index.

This is the largest gap between the underlying and the general rate since August 1986.

In the fourth month of 2021, the Harmonized Consumer Price Index (HICP) increased its interannual rate eight tenths, to 2%, while it rose 1.1% in the monthly rate.

The price of electricity shoots up 37%
In a monthly rate (April over March), the CPI shot up 1.2%, its highest monthly rebound in nine years, specifically since April 2012, driven by the rise in prices of electricity, food and clothing and footwear for the new spring-summer season.

What became cheaper in April compared to March were fruits (-4.8%) and national tourist packages (-3.9%).

On the other hand, what increased the most in price compared to the previous month were children’s clothing (+ 16.9%), women’s clothing (+ 13.1%) and electricity (+ 12.6%) .

In the last year (April 2021 over April 2020), what has risen the most in price has been electricity (+ 36.9%); liquid fuels (+ 31.4%); other oils (+ 21.9%); gasoline (+ 20.2%), and diesel (+ 16.5%).

On the contrary, what has become cheaper since April 2020 are hotels and hostels (-25.6%); international flights (-13.3%); international tourist packages (-13.1%), mobile telephony (-9%), and personal computers (-8.5%).

The annual rate of the CPI rose in April in all the autonomous communities. The highest increase in the annual rate, of 1.2 points, was experienced by Castilla-La Mancha, while the lowest, of seven tenths, occurred in Catalonia.

In April, all the communities presented positive interannual rates
The highest rates in April correspond to Castilla-La Mancha (2.8%) and Navarra and Galicia, both with 2.7%. The autonomous city of Melilla, for its part, shot up its prices by 3% compared to April 2020.

In contrast, the communities with the most moderate year-on-year price increases are the Canary Islands, with a rate of 1.2%; Madrid, with 1.7%, and Catalonia (2%).