Fuel price surge pushes Catalan inflation to 3.1% in March

Inflation – as measured by the Consumer Price Index (CPI) – climbed to 3.1% in March in Catalonia, jumping more than a full percentage point from February's 2%, according to data released by Spain's Statistics Institute (INE) on Tuesday.

The spike is explained by rising fuel prices linked to the war in Iran, marking the highest inflation rate since February last year. Catalonia still remained below the Spanish average, where inflation reached 3.4%. 

Core inflation, which excludes more volatile items such as energy and unprocessed food, rose to 2.7% in Catalonia, up four-tenths of a point, and stood at 2.9% across Spain.

On a monthly basis, prices increased by 1.1% in Catalonia and 1.2% in Spain.

The annual CPI rose in all regions of Catalonia. In Girona and Tarragona, the CPI stood at 3.4%, and in Lleida and Barcelona, it rose to 3%.

The latest rise is the sharpest since mid-2022, when prices soared following the outbreak of the war in Ukraine, though price increases then were significantly higher, topping 10%.

Energy costs drive increase

The combined cost of electricity, gas, and fuel rose 2.5% year-over-year in Catalonia. It contrasts with February's, when the INE recorded a 1.3% drop in prices. 

Across Spain, the same category rose 3.3% in March, compared to a 1.1% drop the previous month.

Overall energy prices jumped 6% in Catalonia and 7.3% in Spain. Fuel prices alone surged 7.2% and 8.6% respectively.

Spain's Ministry of Economy said the increase is a "direct effect" of tensions in the Middle East, adding that a VAT cut on fuel is already helping ease prices at the pump, although international crude oil prices "continue to put upward pressure."

Food inflation eases

Food prices, previously a major driver of inflation, showed signs of cooling. Annual food inflation in Catalonia came in at 2.4%, down slightly from February. 

By product, egg prices rose 18.7% year-over-year, remaining the fastest-growing item. Beef prices climbed 10.1%, while fresh vegetables rose 8.8%. Lamb and fish were also more expensive, up 7.5% and 7.2%, respectively.

Meanwhile, oils and fats continued to decline, dropping 13.9% compared to a year ago after earlier price spikes.