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Inflation returns to positive figures
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After eight months of negative year-on-year change, the consumer price index (CPI) increased 0.3% in the month of November 2009 compared with the same month the year before. This year-on-year rate therefore rose by one percentage point compared with the previous month, thereby fulfilling the forecasts that inflation would return to positive figures towards the end of the year.
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The upswing in prices is boosted by fuels and oils.
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The upswing in inflation in the last few months was boosted by the energy component. Specifically, fuels contributed 9 tenths of a percentage point to the increase in the year-on-year percentage change in the CPI in November, rising 2.6% this month compared with a fall twelve months before.
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Slight decline in fresh foods.
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However, the contribution of the other volatile component of the CPI, fresh foods, was marginally negative. Their year-on-year percentage change fell 0.15 percentage points, posting a drop of 2.7%. In fact, the rises in some foods such as pork and fish were counteracted by falls in others, such as lamb and mutton, chicken and fresh fruit.
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The most stable core of inflation, also known as underlying inflation, which excludes unprocessed foods and energy products, rose by one tenth of a percentage point in November and stood at 0.2% year-on-year. It therefore increased for the first time in half a year. To a certain extent, this turnabout reflects the improved economic situation as the recession eases.
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Slight upswing in core inflation to 0.2%.
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The slight upswing in core inflation is actually attributable to non-energy industrial products. These prices slowed up, although their year-on-year decrease was 1.7%, 3 tenths of a percentage point less than one month earlier. This slowdown was mostly due to clothing and footwear, which contributed almost one tenth of a percentage point to the increase in the CPI year-on-year rate, picking up after sharper falls than those of a year ago.
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On the other hand, processed foods accelerated very slightly, with a moderate annual increase of 0.5%. Rises in oils and milk were largely offset by other falls, such as dairy products. For their part, the year-on-year change in service prices held steady at 1.6%, the lowest for the last few decades.
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Inflation would be flat without the higher taxes.
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It should be noted that prices would have remained at the same level as last year had it not been for special tax increases on tobacco and hydrocarbons in June 2009. This is deducted from the percentage annual change in the harmonized consumer price index for constant taxes, which in September and October was 3 tenths of a percentage point different from the harmonized general index.
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Favourable inflation differential with the euro area falls to 0.1%.
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The EU harmonized consumer price index (EU HCPI) increased 0.4% in 12-month terms, a rise of one point compared with the previous month's rate. Consequently, the differential with the euro area, favourable to Spain, fell to one tenth of a percentage point, 0.8 less than the maximum recorded in the month of May.
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The fall in wholesale prices eases
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The year-on-year fall in wholesale prices has slowed up over the last few months. This reflects the trend in commodity prices that, after plummeting in 2008, have seen a moderate upswing.
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Import prices slowed down their year-on-year drop to 7.2% in October, 2 points less than the previous month, in spite of the appreciation of the euro. This slowdown was due to lower drops in energy prices and intermediate goods. Meanwhile capital equipment prices moderated with a slight year-on-year rise of 0.9% and consumer goods accentuated their fall to 2.1% annual.
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Slight recovery in prices for agricultural and animal products.
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Lastly, in September farm prices at source continued to put the brakes on their year-on-year drop after having slumped at the start of the summer. This was due to arable and animal products such as milk, since meat products increased their decline to 3.6% year-on-year.
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