Spain inflation rate hits eight-month high of 3%, as expected

Spain’s inflation rate rose to 3% in February 2025, its highest level since last June, marking the fifth consecutive monthly increase, according to preliminary estimates.

Spain inflation rate hits eight-month high of 3%, as expected

The figures were in line with market expectations, highlighting the persistence of inflationary pressures. The primary driver of the increase was a rise in electricity prices, which reversed last year’s February decline and contributed significantly to the overall inflation rate. However, the impact of higher electricity prices was somewhat moderated by a softer increase in fuel and oil prices for personal vehicles, which helped alleviate some of the overall inflationary pressures.

Core inflation slows

The core inflation rate, which excludes volatile items like food and energy, fell to 2.1% in February, the lowest level since December 2021, compared to 2.4% in January. This suggests that underlying inflationary pressures may be easing, even though headline inflation remains elevated. On a monthly basis, the Consumer Price Index (CPI) increased by 0.4%, following a 0.2% rise in January and slightly exceeding market estimates of a 0.3% advance. This monthly increase was largely driven by the electricity price surge, though other factors also contributed to the overall rise.

EU-harmonized CPI tops estimates

Meanwhile, the EU-harmonized CPI, which allows for better comparison across European Union member states, rose by 2.9% year-on-year, slightly above forecasts of 2.8%. On a monthly basis, the EU-harmonized CPI also increased by 0.4%, in line with market expectations. The data suggests that inflation pressures are not only persisting domestically but are also broadly aligned with the wider Eurozone trends. Despite the moderating core inflation, the overall inflation rate remains a key challenge for Spain's economy, with ongoing energy price fluctuations and global supply chain dynamics continuing to influence consumer prices.