Fuel and Food Prices Drive June Inflation Lower

Spanish preliminary June HICP came in as expected on the yearly rate at 3.5% Y/Y (vs 3.5% cons; 3.8% prior) and the sequential reading at 0.3% M/M (+0.3% cons; 0.2% prior). The national CPI came in also in line with expectations at 3.4% Y/Y (vs 3.4% cons; 3.6% prior) and 0.3% M/M (0.3% cons and prior).

• Core CPI came in slightly above expectations, and at the same rate as in May, at +3.0% Y/Y (vs 2.9% cons; 3.0% prior). This comes after May's print was the first acceleration after 8 consecutive downticks.
• The headline rate was driven downward by fuel and food prices. Upward contributions meanwhile came from the leisure and culture category.
• Ahead of the release, analysts had expected a strong sequential electricity price increase. There is no mention of this in the press release. Also, it seems plausible that non-energy industrial goods HICP disinflation will stall at some point the coming months but it was not clear if this would come into effect already in June. Again, there is little color on this in the press release.
• For context, Spain represents 11% of the Eurozone HICP basket in 2024.

MNI, Destatis