• Core inflation, which excludes more volatile CPI elements, remains at 1.1%

The Consumer Price Index (CPI) decreased 0.1% in May compared to the previous month and the interannual rate decreased two tenths, down to 1.9%. After this result, the year-on-year rate resumes the downward path interrupted last April and in the first five months of the current year it recorded a half-point cut. The moderation of inflation is due to the decrease in energy products, mainly due to the use of fuels and fuels, and to unprocessed food.

Therefore, by excluding the most volatile elements of the CPI – unprocessed food and energy products – core inflation remains at 1.1% (the same as in April), so that this year this structural indicator falls four tenths.

The month-on-month decrease in the CPI in May is explained by the falls in energy products, fresh food and services. The prices of energy products decreased by 1.9%, especially due to the evolution of their main item, fuels and fuels, which fell by 2.6%. Fresh foods recorded a decrease in their prices of 0.6%, where falls in fresh vegetables and legumes (4.5%), fresh and frozen fish (0.9%) and fresh fruits (0.2%) stood out. . As for services, they reduced their prices by 0.3% compared to April, a moderation mainly due to tourism and hospitality. On the contrary, the indices of processed food and non-energy Industrial Goods increase.

Compared to a year earlier, unprocessed food and energy products moderate their growth rate. The biggest drop occurs in fresh food, whose annual rate is reduced by one percentage point, to 1.1%, and in energy products, with a drop of six tenths, down to 8.3%. Meanwhile, non-energy industrial goods and processed food increase their rate of progress. In fact, the annual rate of processed food rises one tenth, up to 3%, due to the rising cost of tobacco, and non-energy industrial goods also rise one tenth, to 0.2%. For their part, services stabilized with respect to a year earlier (1.1%) and so far this year they have recorded a cut of six tenths (since May 2011, of almost one point).

The moderation of two tenths in the annual rate of the general index in May is a good result. Furthermore, core inflation has stabilized despite the rise in tobacco and the delayed effect of fuel and fuel prices that have pushed up transport prices. Regardless of any punctual rise in inflation in any given month, the trend of inflation continues to be downward.

The INE has also published the harmonized CPI (IPCA) for May, whose annual rate stands at 1.9%, one tenth below that registered in the previous month. This rate coincides with that of the IPCA leading indicator published on May 30. When comparing with the estimated annual rate for the Monetary Union, the differential would continue to be favorable to Spain and would stand at five tenths, compared to –0.6 percentage points the previous month.



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