The Consumer Price Index (CPI) fell by 0.8% in February in year-on-year terms, according to the latest figures published by the National Institute of Statistics (Spanish acronym: INE), as previously announced at the end of last month. Hence, the overall reduction, compared with January, stands at 0.5%, fundamentally down to fuel prices and unprocessed foods. Compared with the previous month, the general CPI fell by 0.4% in February, compared with a 0.2% increase in the same month of 2015.
The prices of energy products posted a year-on-year rate of -14.1% in February, almost four points lower than in January (-10.3%). This fall is due to electricity prices, the rate of which has fallen by 14.2% (-13% in January), and solid and liquid fuels, which has boosted the rate of decline by five points, to stand at -14.2%, in line with the evolution of crude oil prices. However, this latest rate also reflects a significant base effect, since the fuel prices increased in February 2015 by 5.2% on January of the same year. The year-on-year rate of change in food prices stood at 1.2% in February , 0.7% lower than in January, mainly due to unprocessed foods, the rate of which stood at 0.8%, compared with 3.3% in January, with this decline due, to a large extent, to the fall in the price of legumes and fresh vegetables (-9.8%).
Core inflation (which excludes the most volatile components of the CPI, such as fresh foods and energy) rose by 0.1% in February, to stand at 1%, due to a slight increase in the price of services, the rate of which rose by 0.3% to stand at 1.3% year-on-year. This evolution was the result of the heterogeneous conduct of its components. Hence, urban and inter-urban public transport prices continued their decline, due, to a great extent, to cheaper fuel prices, to stand at -0.6% and -1.4% respectively, compared with -0.5% and -1.1% in January. In contrast, the rate for telephone services doubled, to stand at 3%, compared with 1.5% the previous month, and the heading of tourism and hotel and catering increased by 0.2%, to stand at 1.5%. Among the other components of core inflation, processed foods posted a rate of 1.3%, 0.1% down on January, while Non-Energy Industrial Goods (Spanish acronym BINE) remained steady on the previous month, at 0.5%.
In month-on-month terms, the CPI fell by 0.4% in February, following an increase of 0.2% in the same month of 2015. This decline can be explained by cheaper energy products and unprocessed foods, with rates of -2.9% and -1-6% respectively. Within this latter heading, the decline in the prices of fresh fish and fresh fruit are particularly noteworthy, partially offset by the rise in the price of legumes and fresh vegetables. To a lesser extent, the prices of BINEs have also contributed to the month-on-month fall of the CPI, with a negative monthly rate of -0.3%, mainly due to the seasonal fall in clothes and footwear (-1.6%). In turn, the price of processed foods increased by 0.1% and of services by 0.4%, with decreases in the price of urban and inter-urban public transport, of -0.1% and -2.2% respectively, offset by dearer communications prices (1.5%) and of hotels, cafeterias and restaurants (0.4%).
The year-on-year CPI rate in February fell in all autonomous regions. Rates of above the national average were posted in 10 regions, with the highest rates in Catalonia and the Basque Country (-0.5% each). Among the regions which posted rates of inflation below the national average, the lowest rates were posted in Castile La Mancha (-1.4%) and Castile Leon (-1.2%). The annual CPI at constant tax rates stood at -0.8% in February, the same as the general CPI.
The INE also published the harmonised CPI (HCPI) for the month of February, which stood at a year-on-year rate of -1%, versus -0.4% in the previous month. If we compare this rate with that which was estimated by Eurostat for the Eurozone as a whole in February (-0.2%), the positive inflation differential for Spain would rise by 0.1% to -0.8 percentage points.
To summarise, the year-on-year rate of change in the CPI decreased in February by 0.5% due to the changes in its most volatile components - energy and fresh foods - although the indirect effects of lower crude oil prices were particularly noticeable upon Spanish inflation. Particularly noteworthy was its impact on public transport prices, both urban and inter-urban. Core inflation increased by 0.1% to stand at 1% due to the increase in inflation for services. The inflation differential remains positive for Spain when compared with the Eurozone, having risen by 0.1%, which led to gains in competitiveness and the boosting of Spanish exports.
The prices of energy products posted a year-on-year rate of -14.1% in February, almost four points lower than in January (-10.3%). This fall is due to electricity prices, the rate of which has fallen by 14.2% (-13% in January), and solid and liquid fuels, which has boosted the rate of decline by five points, to stand at -14.2%, in line with the evolution of crude oil prices. However, this latest rate also reflects a significant base effect, since the fuel prices increased in February 2015 by 5.2% on January of the same year. The year-on-year rate of change in food prices stood at 1.2% in February , 0.7% lower than in January, mainly due to unprocessed foods, the rate of which stood at 0.8%, compared with 3.3% in January, with this decline due, to a large extent, to the fall in the price of legumes and fresh vegetables (-9.8%).
Core inflation (which excludes the most volatile components of the CPI, such as fresh foods and energy) rose by 0.1% in February, to stand at 1%, due to a slight increase in the price of services, the rate of which rose by 0.3% to stand at 1.3% year-on-year. This evolution was the result of the heterogeneous conduct of its components. Hence, urban and inter-urban public transport prices continued their decline, due, to a great extent, to cheaper fuel prices, to stand at -0.6% and -1.4% respectively, compared with -0.5% and -1.1% in January. In contrast, the rate for telephone services doubled, to stand at 3%, compared with 1.5% the previous month, and the heading of tourism and hotel and catering increased by 0.2%, to stand at 1.5%. Among the other components of core inflation, processed foods posted a rate of 1.3%, 0.1% down on January, while Non-Energy Industrial Goods (Spanish acronym BINE) remained steady on the previous month, at 0.5%.
In month-on-month terms, the CPI fell by 0.4% in February, following an increase of 0.2% in the same month of 2015. This decline can be explained by cheaper energy products and unprocessed foods, with rates of -2.9% and -1-6% respectively. Within this latter heading, the decline in the prices of fresh fish and fresh fruit are particularly noteworthy, partially offset by the rise in the price of legumes and fresh vegetables. To a lesser extent, the prices of BINEs have also contributed to the month-on-month fall of the CPI, with a negative monthly rate of -0.3%, mainly due to the seasonal fall in clothes and footwear (-1.6%). In turn, the price of processed foods increased by 0.1% and of services by 0.4%, with decreases in the price of urban and inter-urban public transport, of -0.1% and -2.2% respectively, offset by dearer communications prices (1.5%) and of hotels, cafeterias and restaurants (0.4%).
The year-on-year CPI rate in February fell in all autonomous regions. Rates of above the national average were posted in 10 regions, with the highest rates in Catalonia and the Basque Country (-0.5% each). Among the regions which posted rates of inflation below the national average, the lowest rates were posted in Castile La Mancha (-1.4%) and Castile Leon (-1.2%). The annual CPI at constant tax rates stood at -0.8% in February, the same as the general CPI.
The INE also published the harmonised CPI (HCPI) for the month of February, which stood at a year-on-year rate of -1%, versus -0.4% in the previous month. If we compare this rate with that which was estimated by Eurostat for the Eurozone as a whole in February (-0.2%), the positive inflation differential for Spain would rise by 0.1% to -0.8 percentage points.
To summarise, the year-on-year rate of change in the CPI decreased in February by 0.5% due to the changes in its most volatile components - energy and fresh foods - although the indirect effects of lower crude oil prices were particularly noticeable upon Spanish inflation. Particularly noteworthy was its impact on public transport prices, both urban and inter-urban. Core inflation increased by 0.1% to stand at 1% due to the increase in inflation for services. The inflation differential remains positive for Spain when compared with the Eurozone, having risen by 0.1%, which led to gains in competitiveness and the boosting of Spanish exports.
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