Calay News
In June, inflation in Spain fell by more than one point to 1.9% year-on-year, according to the provisional estimate published by the National Statistics Institute (INE). This decrease is mainly due to the slowdown in the increase in fuel, electricity, and food prices.
This steep decline provides some breathing space for the Socialist Prime Minister, Pedro Sanchez, with just over three weeks to go before the early legislative elections on July 23. Sanchez is relying on the results of his economic policy to try to reverse the polls that place him behind the right-wing conservatives.
The inflation figure, which has yet to be confirmed, is 1.3 points lower than that recorded in May (3.2%) and 2.2 points lower than that of April (4.1%). It also places the Spanish rate within the 2% target set by the European Central Bank (ECB).
This new decline takes Spain further away from the peak of 10.8% reached in July 2022.
The slowdown marked in June is explained, according to the INE, by the moderation in the increase in fuel and food prices.
For its part, the harmonized consumer price index (HICP), which allows comparisons with other euro zone countries, stood at 1.6%, representing a decrease of 1.3 points with respect to May (2.9%).
Core inflation, which excludes energy prices and adjusts for seasonal variations, also experienced a 0.2-point decrease, reaching 5.9% year-on-year.
Pedro Sánchez’s government has implemented various budgetary measures to maintain household purchasing power, which was strongly affected by inflation of 8.4% on average last year. At the end of December, the executive announced the elimination of VAT on staple foods, a measure that was extended until December 31 this year.
With this provision, the total number of measures adopted by the Sanchez government to deal with escalating inflation amounts to almost €50 billion ($54.57 billion). The 1.9% figure puts Spain in a more favorable position than most of its eurozone neighbors, where inflation reached 6.1% year-on-year in May, according to Eurostat.
