• The underlying rate increases one tenth and reaches 2.2% for processed food
  • The prices of energy products fall 2.3 points, to 5.3%, compared to a year ago

The Consumer Price Index (CPI) posted a 1.3% month-on-month decrease in January, compared to a somewhat smaller drop (-1.1%) from a year earlier, with which its interannual rate decreased 2 tenths, to 2.7%, according to data published today by the National Institute of Statistics (INE).

The decrease in annual inflation was mainly due to the moderation in the prices of energy products and non-energy industrial goods, especially clothing and footwear, which more than offset the acceleration in food. For its part, the set of services maintained its annual rate.

Among the main components of the CPI, processed food grew 3.6% in the annual rate, five tenths above December. The origin of this acceleration was mainly in tobacco, with an increase of 9.7% (3.7 percentage points above December) and in oils and fats, which increased its annual rate by 18%, two points percentage above December.

Meanwhile, non-energy industrial goods reduced their annual rate by two tenths, to 1.3%. The decrease in clothing and footwear stands out (from 0.3% in December to -0.1% in January) and in medicines by almost three points, to 24.3%. The prices of services maintained their annual rate at 2.2%, although variations of different signs are observed in many of its components. The drop in communications stood out for its magnitude, which, due to the lower decrease in telephone services, went from -2.7% to -1.8%. On the contrary, transport registered a cut of nine tenths, from 3.1% to 2.2%, which partly reflects the evolution of fuel prices.

Fresh food increased again with intensity, by four tenths, to 4.3%, due to the acceleration in the prices of fresh fruit, poultry, fresh fish and potatoes. The annual rate for energy products resumed in January the moderation of the last months of 2012, interrupted in December, and posted a significant cut of 2.3 percentage points, down to 5.3%. The decrease in electricity contributed in part to the rise of a year earlier. Its main item, fuels and fuels, moderated its annual rate by 1.5 percentage points, to 4.2%.

The combination of these elements determined that core inflation (which excludes energy products and fresh food) accelerated one point in the annual rate, to 2.2%. The rebound in processed food overcame the slowdown in non-energy industrial goods and the annual rate of services remained constant.

The Autonomous Communities with the highest annual inflation rate in January were Cantabria (3.5%), Catalonia (3.3%) and Castilla y León (2.9%). The least inflationary were Melilla (1.1%), Ceuta (1.8%), Canarias (2.3%) and Madrid (2.4%).

The monthly variation of the CPI was -1.3%, mainly explained by non-energy industrial goods (-4.9%), influenced by the fall, of a seasonal nature, of clothing and footwear (14.7%). ), as well as medicines (-1.2%). The second group with a negative incidence were services (-0.3%), among which the tourism and hospitality items (-1.3%) and the aforementioned communications (-1.2%) stand out.

Fresh food increased 0.7%, due to fresh fruits (2.7%), potatoes and their preparations (1.7%), and fresh fish (1.8%). On the contrary, the monthly drop in sheep meat (3.7%) and fresh legumes and vegetables (1.8%) stood out. Processed food also showed a monthly increase of 0.7%, as a result of the rise in the price of tobacco (3.5%) and the rise in oil prices (1.2%). Energy products rose 0.1% in the month, with clear differences between their components: while fuels and fuels registered an increase of 1.8%, electricity posted a decrease of 4.2%.

In January, the annual rate of the CPI at constant taxes decreased three tenths, to 0.6%, while the underlying rate remained at 0.2%. Within core inflation, the disparity in behavior was also notable, with a drop in non-energy industrial goods (-0.8%), the practical stability of services (0.1%) and a higher rate for food processed (2%). Outside the core inflation block, the rate for fresh food (3.3%) was higher than that for energy products (2.4%).

The INE has also published the harmonized CPI (IPCA) for January, whose annual rate stood at 2.8%, two tenths less than in the previous month. When compared to the annual rate estimated by Eurostat for the euro area as a whole (2%), the differential unfavorable to Spain would remain at 0.8 points, for the third consecutive month. The HICP at constant taxes stood at 0.7%, two tenths less than in December.

In short, the year 2013 has started with a trend towards a slight moderation in prices, similar to that of the last months of the previous year, which is expected to continue throughout the year. It is expected that the year will end at inflation rates significantly lower than the current ones. The continuity in the correction of prices, together with that of labor costs, will allow to expand the improvements in competitiveness of the Spanish economy, with the consequent positive effect on investment and exports. Both are necessary elements for a recovery in the growth of our economy throughout the year.

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