• The different calendar of Easter has also pushed down the price index
  • Core inflation falls four tenths, down to 0.7%
  • The differential favorable to Spain with respect to the euro area remains at one percentage point

The Consumer Price Index (CPI) decreased 1.1% in the interannual rate in April, three tenths more than in March, according to figures published by the National Statistics Institute (INE). This rate coincides with that advanced by the INE at the end of last month. The largest year-on-year decrease in the CPI is due to the steepest drop in energy prices and, in particular, in electricity. The lower inflation of services has also influenced, largely due to the impact of the different calendar of Easter in 2015 and 2016. In month-on-month rate, the general CPI increased by 0.7% in April, two tenths less than in the same month last year.

The prices of energy products registered an interannual rate of -15.1% in April, three tenths lower than in March. This greater decrease was due to the electricity item, which accentuated the four point drop, down to -18.2%. For its part, the year-on-year rate of fuel and fuel prices increased by one point to -14.2%, as a consequence of the lower decrease in its two components: gas, which has gone from registering a year-to-year rate of -13 , 8% in March to -13.2% in April, and fuels and lubricants, which have moderated the rate of decline one point, to -13.4%.

Food inflation stood at 1.8% in April, three tenths higher than in March, an increase that is explained entirely by unprocessed food, whose rate has increased by one point, to stand at 3, 2%. This acceleration responds, to a large extent, to the evolution of the prices of fresh fruits. For its part, processed food prices registered a rate of 1.2% in April, one tenth lower than that of March, highlighting within this group the strong increase in oil and fat prices (15.3%) and of potatoes and their preparations (14.1%).

Core inflation (excluding the most volatile CPI elements, fresh food and energy) fell four tenths in April, to 0.7%, largely due to the slowdown in service prices, six tenths down to 0, 8% year-on-year. This slowdown in services is the result of a divergent behavior of the items that comprise it. The rates of change in the prices of university education (0%) and urban public transport (-0.6%) remained stable, while those of interurban public transport and tourism and hospitality decreased 2.7 and 1.7 points. , respectively, to stand at -2.3% and -0.1%. These decreases have a high seasonal component derived from the celebration of Easter in April last year. The other two components of core inflation, processed food and Non-Energy Industrial Goods (BINE), kept their rates practically unchanged compared to March, at 1.2% and 0.5%, respectively.

In month-on-month terms, the CPI increased by 0.7% in April, two tenths less than in the same month of 2015. The main components of the general CPI contributed to this increase, except for services, whose prices have decreased slightly ( -0.2%). The reduction in the tourism and hospitality component stands out in this group and, in particular, in the organized travel item, -10.6% month-on-month, compared to the 1.1% increase in April 2015, as a consequence of the different calendar of the Holy Week. Among the other groups, the prices of BINE have registered a month-on-month rate of 2.8% in April, one tenth less than a year earlier and food prices have increased 0.2%, due to food unprocessed (0.5%), while the prices of processed have stabilized (0%). The rise in the prices of fresh fruits and fresh fish stands out in the first group, compared to the falls recorded last year.

The annual rate of the CPI has decreased in April in all the autonomous communities. Six of them registered rates below the national average, the lowest corresponding to Castilla-La Mancha (-1.5%), the Valencian Community, Cantabria and Castilla y León, all with a rate of -1.3%, and Galicia and Aragon, with inflation of -1.2%. Among the communities with CPI variation rates above the national average, the Basque Country (-0.7%) and Catalonia (-0.8%) registered the highest rates. The annual rate of the CPI at constant taxes stood at -1.1% in April, as did the general CPI.

The INE has published the harmonized CPI (HICP) for the month of April, whose annual rate stands at -1.2%, two tenths lower than the previous month. If this rate is compared with that advanced by Eurostat for the euro area as a whole in that month (-0.2%), the inflation differential favorable to Spain remains at one percentage point.

In summary, the year-on-year CPI rate fell three tenths in April compared to March due to the greater drop in the price of electricity and lower inflation in services. Core inflation has dropped four tenths, down to 0.7%. The inflation differential favorable to Spain vis-à-vis the euro area remains at one percentage point, with the consequent favorable effects on competitiveness and on our exports.

Source of the new