This inflation slowed his rise to stand 1.9% in June, Lowest level since April 2021, after stopping at 3.2% in May, according to advanced consumer price index (CPI) data released by the National Institute of Statistics (INE). Compared to May, prices rose 0.6%, significantly lower than a year ago (1.9%).
According to INE, “the increase in fuel, electricity, food and non-alcoholic beverages prices increased less this month compared to June last year” was effective in this development.
The decline in the annual rate of increase of CPI by 1.3 points, which pleased the Government, emphasized “Spain”. It is the first country among the major economies of the Eurozone to achieve an inflation rate below 2%.The European Central Bank’s (ECB) reference level”. It also maintains it as one of the EU countries with the lowest inflation. A year ago, in June 2022, the CPI had risen at an annual rate of 10.2 %. Biggest increases due to the war in Ukraine in phase.
Administrative sources attribute this evolution to the measures taken, such as the temporary abolition of VAT on basic food products. (bread, flour, milk, cheese, eggs or fruit, vegetables, legumes, tubers and grains) and reducing the tax rate from 10% to 5% on pasta and oils. All this, they note, “made it possible to reduce inflation by almost 9 percentage points in less than a year, to 1.9%, the lowest rate since June 2021.”
It also goes down Core inflationAlthough it remained high at 5.9% in June after a 0.5% increase from May, it is the most structural, excluding the most volatile elements such as energy and unprocessed food. In any case, it shows: The rise in the shopping cart continues to slow down two-tenths from May, according to this forward forecast, which should be confirmed in the middle of next month.
moderation price increase It was moved to the shopping cart, which slowed down again in May, with a decrease of about one point for the third month in a row, Although it remains at 12%still double digits.
As a result of this evolution and reduction in fuel and electricitythe annual rate fell to 3.2%, the lowest level in nearly two years, and the harmonized indicator used to compare with other EU countries was 2.9%, showing Spain among countries. Lowest inflation in the EU All this allowed a downward correction. Core inflationup to 6.1%.
This development causes the annual rate to deviate further from the 10.8% reached in July of last year, as well as the corresponding rate of core inflation, which reached 7.6% in February. Slow.
According to the Family Budget Survey of the National Institute of Statistics (INE), the increase in prices, especially on basic necessities, caused families to spend about 8% more than the previous year. This is the highest increase recorded in 15 years.
It is precisely because of this information that the Government has decided to pursue measures such as: temporary abolition of VAT on essential products.
The rise in prices prompted the European Central Bank (ECB) to begin raising interest rates, which have risen from 0% last year to 4% since July last year.
loans and mortgages
And that reflected in both Loan demand, as with floating rate mortgagessubject to euribor a year whose daily rate has not ceased to increase and has already exceeded it, 4% level and it may close the month of June with the average level that this index has not seen for 23 years at the beginning of its formation.
All this, according to the Bank of Spain’s estimates, affects 2.77 million of the 3.7 million people who have one of these floating rate loans, above all.