The confirmed CPI data reveals that the drop in fuels has not managed to compensate for the increase of more than 40% in energy or 20% in eggs, cereals or milk
Prices are higher every month. The INE has confirmed what it advanced two weeks ago: the inflation rate has climbed in July to 10.8%, its highest record since December 1984. It represents six tenths more than the previous month due to the increase in the cost of electricity and shopping cart products.
Fuels fall in price compared to June, but this decrease does not compensate for increases such as 41% in energy products compared to July a year ago, or more than 20% in basic foods in the shopping basket such as cereals , eggs or milk.
Inflation is therefore entrenched in two digits and has chained three consecutive months of rises after it moderated in April by 1.5 blow points, to 8.3%. It was just a mirage. In May it climbed to 8.7% and reached 10.2%, despite the implementation of the cap on gas and the rest of the new initiatives of the Executive to try to lower it.
No body now dares to speak of transitory inflation or to blame energy and fuels. What began as an increase in electricity prices more than a year ago has spread to all sectors of activity, particularly food, which has serious consequences for the purchasing power of families, who are concerned how raise the price of your shopping basket.
This is indicated by the core inflation rate (which does not take into account fresh food or energy, the most volatile elements), which also increased six tenths in July to stand at 6.1%, the highest since January 1993.
Oil, almost 30% more expensive
Compared to the prices we had in July last year, fuels have become 34% more expensive (although down 2% since June), energy products 41.4% and heating 44%. On the food side, the situation is alarming. Basic products in the shopping basket such as oil register a rise of 28.6% in one year, eggs and milk 22.5%, cereals 20% or bread almost 15%.
Also in double digits is chicken meat (16.3% more expensive than a year ago), fish (11.4%), beef (14.5%), fruit (15%), legumes (15.5%), potatoes (13.5%) or coffee and cocoa (12%). From the OCU they point out that the most “worrying” thing is that these increases in the basic basket make the situation of Spanish families even more difficult.
That yes, in monthly rate (July against June), the rate descends 0.3% after the previous month (June against May) registered the greatest increase since the 70s, 1.9%. This decline was mainly due to the drop in clothing prices (-11%) and footwear (-8%), due to the start of the sales season. Even so, important increases were registered in tourist packages (13% more expensive than in June) and accommodation services (+2.6%).
Canary Islands and Madrid, below 10%
By communities, all suffered a rise in the CPI in June. The lowest rate of inflation in July was recorded in the Canary Islands, with 9.4%, followed by Madrid, with 9.6%. These are the only two communities where the CPI rate remains below two digits.
The highest level in the country was recorded by Castilla-La Mancha, with 13.2% inflation, followed by Castilla y León (12%) and La Rioja (11.7%). Andalusia (11.2%), Aragón, Murcia and Navarra (11.4% all three), Asturias (11.1%), Extremadura and Galicia (11.5% both) were also above the national average.
Average annual inflation above 8%
On the part of the Government, they expect the CPI to “begin to lower the curve” as of September. This was indicated by the Minister of Industry, Reyes Maroto, who pointed out that they continue “with concern” with the evolution of inflation, but stressed that if the Executive had not taken measures (reduction of fuel or reduction of VAT on electricity), the IPC would have risen 3.5 points more.
The forecasts of the organisms are not positive. Funcas estimates that the CPI rate will remain above 10% in August and that from then on it will drop to around 8% in December. The OECD already estimated a few weeks ago that the average inflation for the year will be 8.1%.
The unions, for their part, insist on the need to raise wages, which grew by 2.6% until July, “well below the general price level,” and include wage review clauses in collective agreements. From UGT they ask that the working class «not be the main victim of a context of economic adversity».
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