Spain's annual inflation rate climbed to 3.5% in July, a three-tenths of a point increase from June, driven largely by significant rises in fuel and electricity prices. The flash estimate, released on Thursday by the National Statistics Institute (INE), indicates that this surge marks the highest inflation level recorded since May 2024, with the rate consistently staying above 3% for five consecutive months.
The statistics office attributed the rebound to the fact that both fuels and lubricants for private vehicles, as well as electricity, experienced sharper price increases compared to the same month last year. This trend is set against a backdrop of more expensive energy, primarily caused by geopolitical tensions in the Middle East, which have pushed up international oil and gas prices in recent weeks.
Beyond volatile energy and unprocessed food products, underlying inflation also saw an increase, rising by a tenth of a point to 3% in July. This suggests that price pressures are extending beyond just the direct impact of energy costs.
For comparison across European Union countries, the Harmonised Index of Consumer Prices (HICP) in Spain registered an annual rate of 3.8% in July, an increase of two tenths of a point from June.
Despite the upward trend in prices, Spain's Ministry of Economy stated that measures implemented to address the economic fallout from the conflict with Iran remain active. The Ministry argues these measures are effectively helping to contain the impact of higher energy costs on overall inflation and to protect households' purchasing power.
