28th September 2023
Petrol pump image. (Erik Mclean / Unsplash)
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Inflation in Spain slowed for May, following drop in fuel prices

Inflation in Spain slowed in May due mainly to lower fuel costs, preliminary data showed on Tuesday, possibly boosting the government led by Pedro Sánchez ahead of an early general election that he has announced for 23 July.

Inflation reached 3.2% year-on-year in May, down from 4.1% in April and 3.3% in March, according to the National Statistics Institute (INE). It is the lowest it has been in a year and a half, long before Russia’s invasion of Ukraine which sparked inflation to soar.

The drop was mainly due to lower fuel prices and a more moderate rise in the price of food, INE said in a statement.

The price of fuel has fallen to levels before the conflict in Ukraine, the INE said. The price of electricity also remained stable in May at an average of 72 euros/MWh, a fall of 20% compared to April and almost half of what it cost a year ago.

Core inflation, which strips out volatile food and energy prices was 6.1% year-on-year, down from the 6.6% recorded in April.

Spain will need to wait until the middle of the month to find out what the increase in the price of the shopping basket is, when the INE publishes the complete inflation data. Up to April, food prices increased by 12.9%, although in the first months of the year they rose by more than 16%.

The latest inflation figures come a day after Sánchez unexpectedly called a snap election for 23 July after his socialist party suffered a drubbing in the weekend’s local and regional polls.

His coalition government has implemented a series of measures to bring down inflation in Spain which hit a record 10.8% in July. It slashed the VAT on essential foods such as bread, milk, fruit and vegetables, and introduced free rail travel passes. 

READ ALSO: Spanish PM calls snap election for July 

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