SPAIN’S inflation rate in March clocked in at 3.3% according to preliminary figures from the National Statistics Institute issued on Thursday.

That’s down on February’s figure of 6% and is attributed to falls in electricity and fuel prices and the big hikes recorded in March 2022 working their way out of the system.

The March inflation rate is the lowest annual figure since August 2021 and has confounded predictions from economists who projected a rate of around 3.8%.

Angel Talavera, chief economist for Europe at Oxford Economics, said: “This should not make us believe that inflationary tensions are over.”

“Core and food prices will remain high, and in addition, the large fall in energy prices in the last months of last year will cause the opposite effect to that of March on the inflation rate in the last months of 2023,” he added.

Core inflation, which does not include variable fresh food and energy prices, was 7.5% year-on-year, slightly below the 7.6% recorded in February.

It’s the first drop- albeit marginal- in the core rate in 23 months.

Food prices are the main issue for most people in Spain with the last stripped-out figure reporting a 16.6% annual rate in February.

The Bank of Spain has predicted that food inflation will remain in double digits for the rest of 2023 with the annual rate in December predicted to be 12.2% before falling to an average rate of 4.6% next year.


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