The CPI climbs to 10.8%, its highest rate since 1984

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The annual variation of the CPI has climbed in July to 10.8%, six tenths more than that registered in the month of June, as the National Institute of Statistics (INE) had anticipated at the end of July. The 10.8% registered in July represents the highest annual variation of the CPI that Spain has had since 1984.

The evolution is mainly due to the rise in housing prices, the prices of food and non-alcoholic beverages and electricity; also the behavior of clothing and footwear, whose prices fall less than last year.

With regard to housing, its annual variation was 23%, four points more. The reason is that electricity prices rise this month compared to the drop recorded in July 2021. The rise in gas, which has been higher than last year, also has an influence, although to a lesser extent.

The increase in clothing and footwear was 13.5%, six tenths more than last month. It is the highest increase since the beginning of the series, in 1994. The increases in the prices of meat and milk, cheeses and eggs stand out (compared to the stability of the previous year), of bread and cereals (greater this month than in 2021) and legumes and vegetables (they fell in July last year).

Also noteworthy, in the opposite direction, was the drop in fuel prices. In July it reflects a Transportation rate of 16.2%, three points lower than that of the previous month. The cause is the drop in the price of fuels and lubricants. In July 2021 it increased. The good trend seems to continue. This week has been the seventh consecutive fall in the price of fuel, and it accumulates a reduction of more than 12% compared to the end of June, although gasoline is still at 1.86 euros per liter, a price that is still high. Collecting the discount of twenty cents per liter established on April 1, the price of a liter of gasoline would stand at 1.66 euros, still 17% more expensive than in August 2021.

As regards the price of electricity, July closed the first full month of the gas cap with the second most expensive energy price (252.3 euros per megawatt/hour) and leaving the third most expensive bill in history for consumers with regulated tariff.

The annual variation rate of core inflation (general index excluding unprocessed food and energy products) increased six tenths, to 6.1%. It is the highest variation since January 1993.

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