• Core inflation is reduced one tenth, to 0.6%
  • The favorable differential of Spain with respect to the euro zone remains at a percentage point

The Consumer Price Index (CPI) decreased by 0.8% year-on-year in June, down two tenths from May, according to figures published by the National Statistics Institute (INE). This data coincides with that advanced by the INE at the end of last month. The lower year-on-year decrease in the CPI is due to the moderation of the rate of fall in energy prices and, in particular, of fuels and fuels and electricity. On a monthly basis, the general CPI increased 0.5% in June, two tenths more than in the same month last year.

The prices of energy products recorded an 11.7% year-on-year fall in June, 2.3 percentage points lower than in May (-14%). The lower rate of decline was due to both electricity (which moderated the intensity of the fall almost three points, to -13.5%) and fuels and fuels (which moderated more than two points, to -11, two%). In turn, the behavior of this last heading is a consequence of the lower decrease of its two components: gas, which has gone from registering a rate of -12.6% in May to -11.6% in June, and fuels and lubricants, which have reduced the rate of fall more than two points, to -10.4%.

The inflation of food stood at 1.4% in June, two tenths lower than the previous month, due to the evolution of both prices of unprocessed food, whose rate has been reduced three tenths to stand at 2.3%, as of processed foods, which registered a rate of 1% in June, one tenth lower than in May. Among the unprocessed food, the lowest rate of year-on-year increase in fresh fruit prices stands out (6.1%, compared to 6.8% in May).

Core inflation (excluding the most volatile elements of the CPI, fresh food and energy) moderated in June one tenth, to 0.6%, as a result of the slowdown in processed food prices (1%, one tenth less than the previous month), of non-energy industrial goods (BINE, 0.3%, one tenth less than in May) and services (0.7%, rate one tenth lower than the previous month). Within services, uneven behavior is observed by components. While the rate of variation in tourism and hospitality prices remains stable, at 0.3%, that of interurban public transport increases 1.2 percentage points, to -2%.

In inter-monthly terms, the CPI increased 0.5% in June, two tenths more than in the same month of 2015. This acceleration was due to the fact that the prices of energy products grew 3.5% inter-monthly, 2.8 points percent more than in the same month last year. On the contrary, the remaining components of the general CPI registered in June inter-monthly rates lower or equal to those of a year earlier. The prices of the BINE registered a month-on-month fall of 0.3%, higher by one tenth than June 2015, and food prices increased 0.2% (0.4% a year earlier), due to both unprocessed food (0.9%, compared to 1.3% a year earlier), as well as processed food (-0.1%, compared to 0.1% in June 2015). Stresses, in unprocessed food, the moderation in the rise in prices of fresh fruits (6.5% in June 2016 compared to 7.3% a year earlier).

On the other hand, the prices of services grew 0.3% month-on-month, as in June 2015, as a result of uneven behavior among its components, highlighting the evolution of prices for interurban public transport, which increased by 0, 9% in June this year, compared to the 0.3% decrease in the same month last year.

The interannual rate of the CPI has increased in June in all the autonomous communities. Seven of them registered rates below the national average, the lowest corresponding to Castilla-La Mancha, Castilla y León and Cantabria (-1.1% in all three cases). Andalucía, Baleares, Extremadura, Madrid and Murcia registered the same rate as the national CPI (-0.8%). Among the communities with rates above the national average, the Basque Country and Catalonia registered the highest rates (-0.5% both). The interannual rate of the CPI to constant taxes stood at -0.8% in June, as was the general CPI.

The INE has also published the harmonized CPI (CPI) for the month of June, whose annual rate is -0.9%, higher by two tenths than the previous month. If compared with that advanced by Eurostat for the euro zone as a whole in that month (0.1%), the inflation differential favorable to Spain remains at a percentage point.

In summary, the annual rate of the CPI has increased in June by two tenths compared to that of May, due to the moderation in the fall in the price of energy products. The inflation differential favorable to Spain against the euro zone remains at a percentage point for the fourth consecutive month, with the consequent favorable effects on competitiveness and exports.

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