The acceleration in prices has been reflected in the main CPI headings, particularly fresh food and energy products, which are the most volatile elements in the general index. Month-on-month, prices rose 0.5%, particularly in the case of energy and fresh food.
Prices of energy products fell by 6.4% year-on-year, 0.8 pp higher than the previous month. The slowdown in the fall is due to fuel moderating its decline by 1.5 points to -7.7%, as a result of the price of fuels and lubricants moderating its fall (-7.4% compared with -9.5% the previous month). The year-on-year rise in prices of fresh food increased by 2.1 points in May to 2.3%. This increase is due mainly to fresh fruit, and to a lesser extent pulses and fresh vegetables.
Core inflation (excluding more volatile elements in the CPI such as fresh food and energy) increased by 0.2 pp in May to 0.5%. This increase is due to the upward trend of inflation in services, processed food and non-energy industrial goods. The price increase in services rose by 0.3 pp to 0.6%, processed food by 0.2 pp to 0.9%, and non-energy industrial goods from zero to 0.1%.
Within the heading of services, the highest inflation rate was in long-distance public transport, which stood at 1.4% following the fall of 1.5% the previous month; telephone services, which moderated its rate of decline by half to -1.7%; and tourism and hotel and catering, whose year-on-year rate increased by 0.5 pp to 1.1%.
Prices of non-energy industrial goods increased their annual rate by 0.1 pp in May to 0.1%. The slightly upward trend is a result of clothing and footwear and car prices. Processed food, including drink and tobacco, increased by 0.9% compared with 0.7% the previous month, which is mainly due to the upturn in the price of fresh fruit, which increased by 6% year-on-year, after the fall of 1.2% in April.
In monthly terms, the CPI increased by 0.5% in May, compared with a flat figure in May 2014. This increase is a result of the rise in all its components, particularly the most volatile ones, fresh food and energy. The prices of fresh food increased month-on-month by 1.4%, compared with a fall of 0.7% in the same month in 2014, due largely to the upturn in fresh fruit (9% after the rise of 1.6% in May last year). Energy products grew by 1% monthly, 0.8 pp more than in the same month last year. The price of industrial non-energy goods increased by 0.9% on April, 0.2 pp higher than in May 2014, while service prices increased by 0.1% in May on the April figure, compared with a fall of 0.3% in the same month in 2014.
The CPI rose year-on-year in May in all autonomous regions. In seven of them inflation was higher than the national average: the Balearic Islands (0.2%); Catalonia (0.1%); the Basque Country (0%); and the Region of Valencia, La Rioja and the Region of Madrid (-0.1% in all three). Andalusia and Navarre had inflation of -0.2%, the same as the national average; Murcia -0.3%; Aragon, Asturias, Cantabria and Galicia each had a rate of -0.4%; Castile-Leon and Extremadura -0.5% each; the Canary Islands and Castile-La Mancha -0.6%; Melilla -0.7%; and Ceuta -1%. The annual CPI at constant tax rates was -0.2% in May, the same as the general CPI.
The INE has also published harmonised CPI figures for May, whose annual rate is -0.3% compared with -0.7% the previous month. Comparing this rate with that estimated by Eurostat for the whole of the Eurozone in April (0.3%), the differential in favour of Spain is down by 0.1 pp, to 0.6 pp.
To sum up, the annual CPI increased by 0.4 pp in May, due to the prices of all its components, particularly the most volatile, fresh food and energy products. Core inflation rose by 0.2 pp to 0.5%, the fifth successive month in positive territory. This means the upward trend in prices and the differential with Eurozone inflation continues, with the resulting positive effect on the competitiveness of the Spanish economy, which in turn will continue to boost exports, production and employment.
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