Spain's inflation steady at 2.3 per cent before Iran war escalation begins
The fall in electricity prices in February counteracted the 3.2 per cent increases in restaurants and food
Inflation remained stable at 2.3 per cent in Spain in February, providing a brief respite before the start of the war in Iran, which is already hitting the price of fuel, electricity and gas.
The rate in February was the lowest since June 2025, as the national institute of statistics (Ine) confirmed on Friday.
Everything suggests that in March, the CPI will rise sharply to rates even above three per cent, according to analysts, mostly due to energy prices.
What explains the stability of inflation in February is the fall in electricity prices, which offset the 3.2 per cent rises in catering and food. Just when the CPI seemed to be finding a path to relative stability after the fluctuations recorded throughout 2025, the purchasing power of Spaniards is once again under attack as a consequence of the conflict in the Middle East. The armed conflict seriously threatens to erode it and jeopardise the economic boom that Spain was experiencing.
Core inflation, which does not take into account fluctuating items such as fresh food and energy products, closed February at 2.7 per cent, 0.1 per cent above January's rate and the highest since August 2024.
However, this February's inflation is only an illusion, especially given that the moderation of prices stems from the downward effect of energy tariffs, particularly electricity. The war in Iran has completely reversed this downward trend and energy prices are the most affected by the closure of the Strait of Hormuz, driving the price of oil above 100 dollars and pushing fuel prices, especially diesel, to their highest levels since the invasion of Ukraine in 2022.
Spain's Minister of Economy Carlos Cuerpo confirmed this in an interview on RNE: "We have inflation in February of around 2.3 per cent. We will see how March ends,after the impact of this rise in energy prices."
According to statistics, the rate of the CPI in February is the result of the eight-point drop in the year-on-year rate of the housing category; the rise in the year-on-year rate of restaurants and accommodation services to 4.8 per cent; and the year-on-year increase in food and non-alcoholic beverages due to the stability of the prices of fuels, fats, fish and seafood.
In monthly terms (February over January), the CPI rose by 0.4 per cent, its biggest monthly increase since last October, when it rose by 0.7 per cent. The harmonised CPI (HICP) raised its year-on-year rate by 0.1 per cent in February to 2.5 per cent, with a monthly rise of 0.4 per cent.
