This slight positive trend in prices is largely due to the upward trend of prices of processed foods, energy products, and non-energy industrial goods (NEIGs), offset in part by a downward trend in unprocessed foods and services. Prices rose by 0.9% on March.
In April, energy product prices posted a year-on-year rate of -7.2%, 0.2 points higher than in the previous month. This easing of the downward trend was mainly due to electricity prices, which rose by 1.6% in the month compared with the stable prices a year ago. This item eases the year-on-year downward rate by 1.5 percentage points to -1.8%. Meanwhile, solid and liquid fuels contributed one tenth to the year-on-year downward rate to -9.2%, due to falling gas prices (-3.3%). The year-on-year rate of change of unprocessed food prices fell by 0.7 points in April to 0.2%. This slowdown is accounted for by the price of fresh fruit and, to a lesser extent, other articles, like lamb and poultry.
Core inflation (which excludes the more volatile elements of the CPI such as fresh foods and energy) was up by a tenth in April to 0.3%, after three months of stability at 0.2%. This increase can be explained by the upward trend in prices of processed foods and non-energy industrial goods, offset in part by a slight downward movement in the price of services. The year-on-year inflation rate of processed foods is up by four tenths to 0.7%, while non-energy industrial goods are up by two tenths to zero. The annual rate for services has eased by a tenth to 0.3%.
Within the group of services, the lower inflation rate was due to tourism and the hotel and catering industry, down by a year-on-year 0.8 points to 0.6%. Organised travel dropped from 1.1% in March to 0.5% in April. This downward trend is partly due to Easter falling entirely in April last year, whereas this year it straddled March and April. Falling interurban public transport prices also contributed to the easing of inflation in services.
Prices of non-energy industrial goods were up by a year-on-year two tenths in April to zero, after over a year and a half of uninterrupted decline. This trend is due to the performance of clothing and footwear prices, and also that of car prices. In April, processed foods, including beverages and tobacco, posted a positive rate of 0.7%, versus 0.3% the previous month. This increase is largely due to the upward trend of items such as cooking oil, coffee and cocoa, among others.
In month-on-month terms, the CPI grew by 0.9% in April, just as it did in the same month of 2014. This is due to the higher prices of NEIGs (especially clothing and footwear, and cars), services (particularly tourism, hotel and catering, and interurban public transport), processed foods (cooking oil), and energy products (electricity tariff, 1.6%), offset in part by lower unprocessed food prices (-0.5%), especially fresh fruit. Prices of NEIGs grew by 2.9% on the previous month, a slightly higher rate than in the previous year, as a result of the seasonality of clothing and footwear (10.6%). Prices of services rose by 0.3% in April over the previous month, mainly as a result of tourism and hotel and catering prices (0.7%), and interurban public transport prices (1.2%).
The annual CPI rate in April rose in five autonomous regions. In six regions, inflation rates were higher than the national average: Balearic Islands (-0.2%), Catalonia (-0.3%), and the Region of Valencia, La Rioja, Madrid and the Basque Country (all -0.5%). Andalusia and Navarre posted an inflation rate of -0.7%, followed by Asturias, Galicia and Murcia (-0.8%), Aragon (-0.9%), Castile-La Mancha (-1.2%), and the remaining regions (-1%). The annual CPI rate at constant taxes for April stood at -0.6%, the same as the general CPI rate.
The INE has also published the harmonised CPI (HCPI) for the month of April, in which the annual rate stands at -0.7%, versus -0.8% the previous month. If we compare this figure with the one estimated by Eurostat for the Eurozone as a whole in April (zero), the inflation differential in Spain's favour remains unchanged at 0.7 percentage points.
To sum up, the year-on-year rate of change of the CPI has increased in April by a tenth, due to price trends affecting processed foods, NEIGs, and energy products. Core inflation is also up by a tenth to 0.3%, and has now posted increases for four consecutive months. Therefore prices continue to recover in a context of moderation. The inflation differential remains positive for Spain when compared with the Eurozone, with the consequent positive effect on the competitiveness of the Spanish economy. In turn, this is driving exports, production, and employment.
EFE