Producer price inflation in Spain eased to 1.9% year-over-year in April 2025, marking its second consecutive monthly decline and the lowest level recorded in five months.
Spain producer inflation hits five-month low
The continued slowdown signals a broader cooling of upstream price pressures across the Spanish economy, offering potential relief to businesses grappling with input costs. The deceleration was primarily driven by a sharp pullback in energy prices, which rose by just 5.7% in April—down significantly from the 15.8% surge recorded in March—reflecting both base effects and falling wholesale energy rates across Europe.
Other components of producer prices also showed signs of moderation. Prices for intermediate goods, which serve as inputs for manufacturing, rose marginally by 0.1% following a 0.6% gain the previous month, indicating a potential stabilization in supply chain cost dynamics. Meanwhile, consumer goods prices declined further, falling by 1.1% after a 1.6% drop in March. The decline was mainly attributed to a 1.3% decrease in prices for non-durable goods, such as food and household items, suggesting subdued demand or improved supply conditions in these sectors.
Broader disinflationary trend
When excluding the volatile energy component, producer prices posted a 0.1% decline from a year earlier, matching March's reading. This consistency underscores the broader disinflationary trend beyond energy markets and points to easing inflationary pressure across Spain's industrial base. On a monthly basis, producer prices dropped by 2.9% in April, following a sharper 4.1% decline in March, reinforcing the idea that cost dynamics for producers are continuing to improve as global commodity prices retreat and supply chains normalize.
The latest data may offer some breathing room for the Bank of Spain and the European Central Bank, both of which are closely monitoring input price trends as they shape future monetary policy decisions. While consumer inflation remains above target in some areas, easing producer prices could filter downstream into lower consumer prices in the coming months, especially if demand remains subdued. The figures also provide tentative evidence that Spain’s industrial sector may be regaining pricing stability after years of pandemic- and war-induced volatility.
