INE confirms that inflation reached 2.9% in December |Economy |country

The average increase in prices last year was 2.7 percent, which was about one unit higher than the average of the Eurozone

INE confirmed December inflation was moderate at 2.9%.

Average price growth over the past year was 2.7 percent, which is almost one point above the Eurozone average

Inflation is slowing, but slowly.The National Institute of Statistics (INE) confirmed on Thursday that prices eased in the last period of the year and fell by a tenth in December, up to 2.9%.Considering the whole year, Spain's average inflation was 2.7%, which is only a tenth of the 2.8% registered in 2024, and is still almost a point above the Eurozone, which clearly shows a decrease in the inflation process.

The slowdown in December inflation was explained by the fall in fuel prices and, to a lesser extent, cheaper prices of travel packages and entertainment and sports services compared to the previous year."Compared to the average of 2024, inflation will continue at a moderate level and will be lower than salary increases, which will enable an increase in purchasing power," the Ministry of Economic Affairs celebrated after receiving the information.

On the other hand, groceries and non-alcoholic beverages have become more expensive by 3% over the same period. This is the highest rate since July 2024, which confirms a fundamental trend: food inflation has stalled and lifted the general index, with the basket increasing by more than 30% since inflation took place in 2022 as a result of Russia's invasion of Ukraine. And the resistance to cheapening explains to some extent the delay in the path to normalization of prices.

According to the results of December, in the food category, the evolution was weighed by legumes and vegetables, which rose in price by 7.3%.However, the largest increase in this position was seen in eggs, with inflation exceeding 31%, reflecting supply cuts introduced to stem the spread of bird flu.African swine fever (ASF), which has rocked Catalonia, on the other hand, has not hit pork prices as feared, rising six-tenths in December compared with 17.2% for cattle and 7.4% for sheep.Olive oil, for its part, continues its downward trend, with a decrease of 31.6% compared to the same month of the previous year, the most striking statistic.

Raymond Torres, director of economic conditions at the think tank Funcas, explains that the slow pace of the deflation process is due to the resistance of both services and unprocessed foods to an environment of solid economic growth.In the latter case, he predicts a “very gradual” decline.Especially in China, they will continue," he explains. The third element he mentions is energy: "The positive part is oil, waiting to see what happens in Iran, but prices have been controlled;"Electricity can apply pressure."

If all types of products and services analyzed by INE are considered, the most expensive sector at the end of the year is jewelry and bijoux (31.6%), followed by the collection of eggs and garbage (30.3%), which is affected by the implementation of the new waste rate.Among the main sectors, housing is in crisis and price crisis, with a year-on-year increase of 5.7%.is in the first place.In second place are restaurants and hotels, which rose 4.6%.For core inflation, a basket that excludes the most volatile products such as energy or fresh groceries, it stood at 2.6%, the same rate recorded in November - the full-year average fell to 2.3%, compared to 2.9% in 2024 - and the highest rate since December 2024.

"The December data was expected by CaixaBank Research, and they confirm the moderation that inflation is registering after a rise in mid-2025". "For this year we expect the moderation to continue, mainly in favor of the energy component, although this forecast will be marked by the inflation data from January".

Spain's price history for 2025 is not very strong, but has a series of ups and downs.The year started with inflation of 2.9% and it closed at the same rate.In between, there were contractions and rebounds.According to the European benchmark, the lowest rate of the year was reached in May, with an increase of 2%.But after spring, the Consumer Price Index (CPI) applied pressure again: piling on five consecutive months of increases and cutting off the path to default.

This wear and tear has a lot to do with the behavior of the electricity when it stopped on April 28, which left the Iberian Peninsula in the dark and increased security, and increased the cost of supply.Looking ahead this year, it is likely that there will be a slight increase in the amount of the account, because there will be an increase in the regulated costs of the account and there is doubt whether the practice of clean energy resources will pay for these increases.

The community most affected by inflation in December was Madrid, which rose almost one point above the national average, to 3.7%.Above-average growth was also recorded by the Valencian Community (3.2%).In other regions, prices developed at or near the average (Aragon, Balearic Islands, Cantabria, Extremadura, Basque Country).Catalonia (2.5%) and Murcia (2.4%) were the regions with the most moderate growth.

Looking forward to this January, Torres predicts a positive development due to the results of the process: the CPI rose in the first year of last year due to the reform of taxes and other elements."This gives us an annual [interest rate] that could be 2.5% or even a little lower this January. But it does not cover the other [rising] trend. We expect inflation to remain at 2.5% during the year 2026. This means that "It affects purchasing power and threatens competition because the estimate of inequality in competitioneuro."

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