- Core inflation increases one tenth, up to 0.7%
- The inflation differential favorable to Spain with respect to the euro zone stands at 0.9 percentage points
The Consumer Price Index (CPI) decreased 0.6% in the interannual rate in July, down two tenths from June, according to figures published by the National Institute of Statistics (INE). This rate coincides with that advanced by the INE at the end of last month. The moderation in the fall of the CPI has mainly rested on the acceleration of the prices of unprocessed food, although non-energy industrial services and goods (BINE) have also contributed to this evolution. In the inter-monthly rate, the general CPI has decreased 0.7% in July, due largely to seasonal factors related to summer sales on clothing and footwear.
The prices of energy products recorded a 12% year-on-year fall in July, three tenths higher than in June (-11.7%). This slight deceleration is explained by the evolution of electricity prices, which accentuated the rate of decline 1.4 points, to -14.9%, while the heading of fuels and fuels recorded a rate of -11.1 %, similar to the previous month (-11.2%).
Food inflation in July stood at 2.3%, nine tenths higher than the previous month, due to the rebound in prices of unprocessed foods, whose rate increased 3.4 points, to 5, 7% This acceleration responds, to a large extent, to the sharp increase in the prices of fresh fruits (14.4%) and of fresh vegetables (9.3%). On the contrary, the rate of increase in processed food prices moderated slightly in July, two tenths to 0.8%, due in large part to the evolution of the price of oils, which registered an interannual rate of 10 , 5%, lower by 3.3 points than in June.
Core inflation (excluding the most volatile elements of the CPI, fresh food and energy) increased in July one tenth, to 0.7%, as a result of the acceleration of BINE prices (one tenth to 0.4 %) and services (two tenths up to 0.9%). The increase in organized travel prices (0.7% year-on-year) stands out within the latter group, after the decrease close to 5% in the previous month.
In month-on-month terms, the CPI decreased 0.7% in July, down two tenths from that of the same month of 2015. The less contracting evolution of the CPI is due to the increase in food prices (0.6% month-on-month ), compared to the 0.3% decrease recorded a year earlier. The services have also helped to moderate the intensity of the fall, registering an inter-monthly rate of 0.7%, higher by one tenth than that of July last year. In July, the remaining components of the general CPI recorded inter-monthly rates less than or equal to those of a year earlier. The prices of the BINE decreased 3.9% month-on-month, as in July last year, and those for energy products decreased 1%, four tenths more than a year earlier.
Within the food group, prices for unprocessed foods increased 2.1% month-on-month in July, compared to the 1.3% decrease in the same month of 2015, while those for processed foods decreased slightly (-0, 1%), after the increase of the same magnitude a year earlier. Stresses, in unprocessed food, the rebound in prices of fresh fruits (5.2% in July this year compared to the decrease of 2.4% in July 2015).
The interannual rate of the CPI has increased in July in all the autonomous communities, except in La Rioja, where it has remained stable. Eight rates were lower than the national average, with the lowest corresponding to La Rioja (-1%), Castilla-La Mancha and Castilla y León (-0.9% both). Andalusia, Madrid and Murcia registered the same rate as the national CPI (-0.6%). Among the communities with rates above the national average, the highest were recorded by Navarra (-0.3%) and Catalonia and the Basque Country (-0.4% both). The interannual rate of the CPI to constant taxes stood at -0.6% in July, as was the general CPI.
The INE has also published the harmonized CPI (CPI) corresponding to the month of July, whose annual rate is -0.7%, higher by two tenths than the previous month. If compared with that advanced by Eurostat for the whole of the euro zone in that month (0.2%), the inflation differential favorable to Spain is reduced by one tenth, to stand at 0.9 percentage points.
In summary, the CPI moderated in July the rate of year-on-year fall for the third consecutive month, due to the acceleration of prices of unprocessed food and, to a lesser extent, services and BINE. Core inflation has increased one tenth, to 0.7%, and the inflation differential favorable to Spain against the euro zone remains close to a percentage point, with the consequent favorable effects on competitiveness and exports.
