Prices in Spain rose 1.9% in June, according to an official estimate released this Thursday which, if confirmed, shows a drop of 1.3 points in inflation, which had been 3.2% in May.
This evolution of the inflation rate (increase in prices compared to the same month of the previous year) in Spain “is mainly due to the fact that this month there has been an increase in the prices of fuel, electricity and food and non-alcoholic beverages was lower than in June of last year”, explained the National Institute of Statistics (INE) of Spain.
The underlying inflation estimate (which excludes energy and unprepared fresh food) for this month is 5.9%, two tenths less than in May.
Throughout 2022, Spain approved several packages of measures to deal with inflation of more than 3% of the Gross Domestic Product (GDP), around 45,000 million euros, including direct aid to consumers and companies and tax benefits, such as the reduction of VAT on electricity and gasoline to 5% or a discount of 20 cents per liter on the purchase of fuel.
In an attempt to respond to rising food prices, a new set of measures came into force in January, including the suspension of VAT (consumption tax) on some foods and products considered basic.
Spain closed last year with the lowest inflation rate in the European Union (5.7%), after having one of the highest values in the first half of 2022 and having registered the highest inflation in the country since 1984 in July (10.77%). .
In May, Spain continued to have one of the lowest inflation rates in the European Union, according to European data.
The Spanish Government has approved this week the maintenance until the end of the year of the elimination of VAT on food products considered basic and 50% discounts on public transport passes.
Other measures in force in Spain since last year or since the beginning of 2023 to respond to inflation have also been extended for another six months today, such as 50% discounts on public transport passes, discounts on agricultural diesel and for professional transporters, maximum limits for the cost of gas cylinders or support for electricity bills.
The Minister of Economy and First Vice President of the Spanish Government, Nadia Calviño, justified the extension of the measures, contrary to the recommendations of the European Commission, due to the “greater uncertainty” surrounding the war in Ukraine.
Nadia Calviño stressed that, however, the measures are compatible with “the way” to reduce the Spanish public deficit, as attested to by the forecasts of national and international entities, and that, on the other hand, all the measures have demonstrated their effectiveness in recent months, Spanish inflation currently being among the lowest in Europe.
According to Nadia Calviño, the new support package approved this week by the Council of Ministers is the seventh since the war in Ukraine began and, as a whole, all the aid and measures already amount to 47,000 million euros.
Source: TSF
