Food prices have steadied and, more importantly, electricity costs have shifted downward, helping inflation dip to 2.8% in February according to the consumer price index released by the National Statistics Institute. This marks the first time in six months that the annual rate has fallen below 3%. The INE confirms the definitive IPC figure, which had been previewed at the end of February, and underscores a continuing trend toward price stabilization across key expenditure categories.
Economists note that the inflation decline is especially notable in food costs, which dropped by more than two percentage points to an annual rate of 5.3% — the lowest since January 2022 — aided by stabilizing prices in the most recent month. The Ministry of Economy points out that electricity price reductions have been a decisive factor in this substantial drop. Conversely, fuel prices rose, contrasting with a year-ago February when they had fallen, highlighting a selective easing across the inflation spectrum rather than a uniform movement.
Another example of shifting price dynamics is olive oil, a classic indicator of price surges over the past two years. In February it rose by 5.3 points after January brought relief with the arrival of the new harvest. Likewise, chocolate bucked the broader trend, climbing by 4.5 points versus January. These items illustrate how some staples can diverge from the general inflation path, even as overall prices ease in other sectors.
A notable downward adjustment came in electricity, which fell 5.2% from January and 7.7% from February of last year. Natural gas also became cheaper, recording a 1% decline in the most recent month and an overall 21% reduction over the past year, signaling steady improvements in energy affordability amid broader price moderation.
The underlying inflation halved over the year
Turning to the underlying inflation rate — which excludes the most volatile energy prices and unprocessed foods — the rate sits at 3.5%, the lowest in nearly two years after a year-long reduction that has shaved more than half of its level. The ministry emphasizes that this easing demonstrates the economy’s capacity to sustain stronger growth while keeping price pressures in check and protecting vulnerable households through social measures. The trend suggests a resilient economy managing to balance growth and price discipline in a period of divergent pressures across sectors.
From a policy perspective, the mixed trajectory across categories highlights the importance of continuing careful monitoring of energy markets, food supply chains, and consumer demand. The current inflation composition points to a gradual normalization rather than a dramatic shift in price behavior. In practical terms, households are feeling some relief in their energy bills and some everyday goods, but periodic spikes in food or certain staples remind observers that inflation remains a moving target, sensitive to external shocks and seasonal cycles.
Analysts caution that the path ahead will depend on external factors such as energy price volatility, global commodity movements, and domestic demand. While the overall rate has cooled, the composition reveals pockets of price pressure, especially in specific food items and discretionary goods. The central message remains clear: inflation is moving in the right direction, but a return to pre-pandemic stability requires continued vigilance and targeted support where needed.