Inflation eases to 3.2% in May, the lowest in a year and a half
Inflation maintains the downward path that began in September of last year, after a summer tense by the consequences of the war in Ukraine, closing May with an interannual rate of 3.2%, according to advanced data from the INE. This is the lowest reference since the autumn of 2021, long before the Russian intervention began, motivated by the decrease in the price of fuel and electricity, the two components that precisely led the economy to historical inflation. in four decades just over ten months ago.
In this period, Spain has gone from having a serious problem of price containment, which has affected the entire economy and the loss of purchasing power of workers and the lack of competitiveness of companies, to getting closer and closer to the objective of 2 % set by the ECB (European Central Bank) to have a stabilized economy.
The leading indicator of the CPI for May shows that prices have fallen again by nine tenths this last month. It has done so due to the decline in diesel and gasoline prices, which have fallen to new lows so far this year, below levels before the outbreak of the war in Ukraine. Specifically, until last week, the average price of a liter of diesel stood, after ten weeks of falls, at 1.40 euros. For its part, gasoline has chained its fifth consecutive fall and, with a decrease of almost 0.2%, it stands at 1.57 euros, its lowest level since February 2022.
The price of electricity also remained at stable levels this May up to an average of 72 euros/MWh, which represents a 20% drop compared to April and practically half of what it cost a year ago.
The other major economic price concern, core inflation, is also beginning to decline. This rate, which measures the cost of daily living excluding the most volatile products, such as energy and unprocessed food, stands at 6.1%, which is five tenths less than the previous month. It is explained, according to the INE, because "the rise in food prices has been less" than a year ago.
We will have to wait until the middle of the month to find out what the increase in the price of the shopping basket is, when Statistics publish the complete inflation data. Until April, the price of food increased by 12.9%, although in the first months of the year it exceeded 16%.
With these data, the Government will have to decide within a month what to do with the measures put into force to act against the crisis: VAT reduction on certain foods, fuel rebate for carriers or a 200-euro check, among others. The most recent data, such as inflation for May, confirm the relief that businesses and households currently have both when filling their deposits and when facing the electricity bill, at least if current costs are compared with those They came to take over the summer of last year, setting record after consecutive record.
