Alex Trelinski
SPAIN’S annual inflation rate rose to 3% in January- up 0.2% on December- according to preliminary figures published by the National Statistics Institute (INE) on Thursday.
The increase was largely down to higher fuel prices and more expensive electricity.
Fuel costs have reached highs not seen since last summer, but they are still far lower than the peaks recorded in 2022.
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Electricity has seen wholesale costs reach above €100 per megawatt-hour (MWh) in recent weeks with rising gas prices one of the main factors behind price increases.
Also from January 1, tax discounts on basic foodstuffs introduced by the government as an anti-inflation measure were discontinued.
The INE said a drop in leisure and cultural activity costs helped to partially tcounterbalance the energy price hikes.
Thursday’s news means the Consumer Price Index (CPI) has now risen for four consecutive months.
The core inflation rate, which excludes the most volatile items like energy and food products, fell by two-tenths of a percentage point to 2.4%.
Spain’s annual inflation rate has risen in recent months having gone down to 1.5% in September, and is now above the average rate of the eurozone as a whole.
Analysts predict the inflation rate will fall this year, with the IMF expecting the average CPI in 2025 to reach 1.9%; the European Commission estimates 2.2% and the Bank of Spain 2.1%.
