Inflation spikes again. It is already necessary to go back almost forty years to find levels similar to the current ones. The energy, the food, the pressure of the demand of the families and the return of the tourists, with a general rise in tourist prices, inflate the monster.
In July it grows six tenths and reaches 10.8% year-on-year, according to the data advanced this Friday by the INE. Far from giving a break, it marks its highest level since September 1984. Behind the rise, the pull in food and electricity prices, which fell a year ago, according to the statistical institute. Clothing and footwear also impact, which do not drop as much as in July 2021. The slight respite comes from fuels, which drop.
Core inflation also rose six tenths, the one that does not take into account the evolution of fresh products and electricity. It stands at 6.1%, a maximum since January 1993 "It is a bad figure. It is the main task that the Government of Spain has ahead of it," said President Pedro Sánchez in a speech this Friday.
"The trend is for it to rise more, now in summer people are spending, it is the first summer in conditions after the pandemic. And tourist prices are rising: hotels have risen a lot, flights too. We will see when it is reflected later. In September, with a possible energy shortage, it can even reach 14%-15%", explains Juan Carlos Higueras, economic analyst and professor at EAE Business School.
Added to this is that "the government's measures are not working." "They are not measures to fight inflation. The 20 cents on fuel are just a relief, the gas cap if you have to compensate is not significantly noticeable on the bill, giving a check for 200 does not help with inflation... ", review.
"Inflation is a global phenomenon and one of the main consequences of the geopolitical tensions that are producing a continued increase in energy prices, especially gas, and also food," they point out from the Ministry of Economy.
Since February of last year, when it was at 0%, inflation has started an unstoppable escalation that has taken it to two figures. Initially, the increases were limited to electricity and fuel, but the higher energy cost has been spreading to the rest of the products, infecting the entire shopping basket. Ahead, more curves. "Inflation endangers the growth data for 2022. We are seeing how operating costs are being transferred to products and that casts doubt on how this whole set of measures, especially monetary policy, is capable of controlling the growth of prices and not enter a recession. As has happened in the US, which has entered a technical recession, we will also see something similar here, "says Javier Molina, spokesman for the eToro platform.
When refueling, when traveling, on bills... Inflation is also noticeable when going to the supermarket, where prices have been seen from price increases to redunflation, maintaining the price in exchange for less product. According to a calculation by the OCU, Spaniards are paying an extra 830 euros in their basket for the price increase. "There is a problem of expectations that feeds on itself. Those who generate the supply raise prices, they anticipate it. It is not logical that oil triples. Prices are rising more and more. With the excuse of the CPI everyone is raising prices. Those cents that coffee rises, it seems that they are not noticeable, but as a percentage it is a strong rise", comments Higueras.
After threatening to go to 10% in March (with 9.8%) came a drop to 8.3% in April, to then increase again to 10.2% in June, the highest since April 1985, nearly 40 years ago. With blow after blow on the consumer's pocket, the Executive tried to stop the increases with the reduction and suspension of taxes on the electricity bill -VAT went from 21% to 10%, the generation tax was suspended, the electricity was lowered to a minimum of 0.5% - and with a subsidy of 20 cents when refueling. Later, the cap on gas in the wholesale electricity market followed, seeing that prices continued to skyrocket.
To know what has risen the most, we will have to wait for the final data, on August 12. Month on month, comparing what things were worth in June with the prices in July, the CPI fell two tenths, after the strong rise of 1.9% in the previous month.
