Spain’s 12-month inflation resumes upwards trend after April dip

MADRID (Reuters) – Spanish 12-month inflation resumed its upward trajectory in May after a dip in April as prices other than energy and food rose at their fastest pace in two decades, preliminary data from the National Statistics Institute (INE) showed on Monday.

Spanish annual inflation accelerated to 8.7% in May, up from 8.3% the previous month, INE said. Twelve-month inflation stood at 9.8% in March, its highest level since 1985.

Annual inflation was higher than the 8.3% forecast by analysts polled by Reuters.

The economic fallout from Russia’s invasion of Ukraine has fueled inflation worldwide, especially through increasing prices of energy and grains.

Core inflation, which strips out volatile food and energy prices, rose to 4.9% year-on-year in May, a 26-year high, from 4.4% a month earlier, the INE data showed.

Although electricity prices in Spain declined compared to last year, the INE attributed the rate increase this month mainly to higher fuel, food and non-alcoholic beverage prices.

Spanish European Union-harmonised inflation was 8.5% in the 12 months through May, up from 8.3% a month earlier.

(Reporting by Mariana Ferreira Azevedo; editing by Inti Landauro and Gareth Jones)