• Core inflation, the stable core of prices, falls one tenth to 1.6%

The Consumer Price Index (CPI) registered a month-on-month increase of 0.3% in August, compared to 0.6% a year earlier. Consequently, the year-on-year rate has decreased three tenths of a percentage point, to 1.5%, according to data published today by the National Statistics Institute (INE). This moderation in the annual inflation rate is largely explained by the prices of energy products and services.

The annual energy rate has decreased to -2.2% from -0.4% last July, due to the evolution of its main component, fuels and fuels. The annual rate of the latter has decreased from 2.6% last July to -1.1% in August. The global decrease in the prices of energy products occurs despite the fact that the electricity rate has risen 3.3% last August and in the same month of 2012 did not change.

For its part, the annual rate of fresh food has increased two tenths of a percentage point, to 7.6%. This new rebound is due to the acceleration in the prices of fresh fruits and poultry and pork, whose annual rates have risen to 25.9%, 2.8% and 3.3%, respectively. On the other hand, the annual rate of potato prices and its preparations has dropped by more than 6 percentage points, although it remains at high levels (31.2%).

Core inflation or stable nucleus of prices has decreased one tenth, to 1.6%, due to the moderation of inflation in services and, to a lesser extent, in processed foods. The annual rate of BINES (non-energy industrial goods) has increased two tenths percentage since July, to 0.4%. This is a result of the departure of medicines and therapeutic materials has increased by 1.5 points, to 7.9%, and the price of automobiles, which has gone from -2.3% in July to -1, 8% in August.

For its part, processed food, beverages and tobacco reduced its annual rate slightly, from 3.4% in July to 3.3%. This modest slowdown mainly responds to the moderation of some food preparations and the slowdown (seven tenths since July) in the prices of oils and fats. This heading, with an annual rate of 23.2%, nevertheless continues to lead the inflationary tensions of this group. Services reduced their annual rate by two tenths, to 1.7%, a fall that has mainly responded to the heading of tourism and hospitality, which has decreased its annual rate by two tenths, to 1%. The CPI other services subclass has seen its rate cut from 13.6% to 5.7% in just one month.

The monthly increase of three tenths of the general index responds, especially, to energy products and fresh food. The former increased 1.2%, due to the electricity rate and fuels and fuels that increased 0.5%. Fresh food increased 1%, due to the rise in prices of fresh fruits (4.9%), sheep meat (2.6%) and poultry (1%). Conversely, the decrease in clothing and footwear (-1.2%), fresh vegetables (-4.4%) and potatoes and their preparations (-2.2%).

The Autonomous Communities with the highest year-on-year inflation rate in August were Murcia (2%), Cantabria (2%) and the Basque Country (1.9%). The least inflationary communities were Melilla (-0.2%), Canarias (0.3%) and Ceuta (0.8%).

In August, the annual rate of the CPI at constant taxes decreased three tenths, down to -0.5%, and the underlying rate decreased one tenth, down to -0.4%. In the constant tax index, the annual rate of energy was -4.8% (-3.1% last month) and that of fresh food was 6.5% (6.3% in July). Within the core of inflation underlying constant taxes, BIN prices fell 1.8% (-1.9% in July), processed foods rose 1.9% (1.8% last month) and the prices of services fell by 0.3% (-0.1% in July).

The INE has also published the harmonized CPI (IPCA) for August, whose annual rate stands at 1.6%, 0.3 points below that of the previous month. If this data is compared with the annual rate estimated by Eurostat for the euro area as a whole (1.3%), the differential unfavorable to Spain would remain at 0.3 points.

In short, the moderation of global and core inflation continues and the trend is expected to continue in the coming months, due, among other reasons, to the discount of the successive upward price steps that the fiscal consolidation measures generated in 2012. The consequent reduction in the inflation rate, together with the continuation in the wage moderation, will give continuity to the recovery of a positive differential of price growth vis-à-vis European trading partners, in particular, and of improvement in competitiveness in general. . This is favoring the dynamism of exports already evident in the 2013 data and the recovery of production and employment.



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