Inflation in Spain soars to above 10% in June

Driven by rising energy and food costs, prices reached the highest levels seen since 1985

A car stopped at a petrol station to refuel (by ACN)
A car stopped at a petrol station to refuel (by ACN) / ACN

ACN | Barcelona

June 29, 2022 09:15 AM

Inflation in Spain grew by a further 1.5 percentage points in June to reach 10.2%, the highest level seen since April 1985, according to provisional figures released on Wednesday morning by the National Statistics Institute.

The increase in the consumer price index is largely driven by rising costs of food and energy.

Inflation has also been driven by the price of hotels, cafes, and restaurants, which have increased in prices compared to 2021.

Inflation has been skyrocketing this year in Spain and across the world, due to factors such as the global supply chain issues seen since the pandemic, and exacerbated ever since Russia's invasion of Ukraine. 

The previous peak of this current wave came in March when prices were 9.5% higher than the previous year.

On the other hand, the estimated annual rate of change in core inflation - which does not take into account unprocessed food or energy products - rose by 0.6 points to 5.5%. If this data is confirmed, it will be the highest since August 1993.

Made with Flourish

Record-high inflation rates are largely attributed to the soaring cost of utilities – that is to say, water, gas, and especially electricity.

The cost of electricity has been making headlines since summer 2021 as an overreliance on polluting energy sources coupled with low natural gas reserves has forced prices to skyrocket.

Learn more about the cost of living crisis, fuelled by rising prices and intensified by the consequences of the war in Ukraine, by listening to our recent Filling the Sink podcast episode, which first aired in early April 2022: 

Spanish PM admits situation is “bad”

The Spanish prime minister, Pedro Sánchez, admitted on Wednesday that the inflation data is "bad," and pointed out that it is one of the effects of Europe cutting the supply of Russian gas to the continent. 

According to Sánchez, the data shows the "gravity of the situation" across Europe, while also proving the "suitability" of measures his cabinet has taken, such as the cap on gas prices, and the need to continue such steps to mitigate against citizens bearing the brunt of price increases.

The Spanish PM made these statements in an interview with Cadena Ser where he pointed out that his executive is working at the European level to reform the wholesale gas market across the continent and to set a cap on the price of oil.