Alex Trelinski
SPAIN’S inflation rate in July climbed to 2.7% due to higher electricity prices.
Preliminary monthly figures released on Wednesday by the National Statistics Institute(INE) showed the month-to-month increase was a significant 0.4%.
It’s the biggest inflation rate since February.
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An Economy Ministry statement said: ”This is due to a base effect associated with the fall in the price of electricity in July 2024, and, to a lesser extent, a rise in fuel prices.”
International uncertainty caused by Donald Trump’s tariff policies and the Middle East situation may also be driving up prices, especially for energy and fuel.
Core inflation which strips out volatile energy and fresh food costs remains stable at 2.3% year-on-year, just 0.1% higher than in June.
“The inflation rate is compatible with the strong dynamism of the Spanish economy, which remains a driver of growth among the major European countries,” the Ministry stated.
“This price stability, the record job creation, and rising wages are allowing families to gradually recover their purchasing power,” it concluded.
Spain’s inflation rate has now risen over two consecutive months after reaching 2% in May which is the target set by the European Central Bank.
Barring any dramatic changes, most economists believe that the year will end at around the 2% mark.
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