Inflation in Spain remains stable at 3.2 per cent despite electricity and gas price increase

Prices offered Spanish households some relief in June, with inflation holding steady at 3.2 per cent, according to figures the national institute of statistics (INE) confirmed on Wednesday.

June marks the third consecutive month that annual inflation has remained at 3.2 per cent, following April and May, despite geopolitical tensions that have unsettled markets and pushed up oil prices.

The INE said higher housing costs drove inflation upwards, largely because electricity and gas prices rose after the government withdrew tax measures designed to keep them down on 1 June.

Lower transport costs, however, helped offset those increases as fuel prices fell. Fuel had been one of the main drivers of inflation in recent months following the energy shock triggered by the conflict with Iran.

Throughout June, tax measures to keep fuel prices down remained in force. These included reduced excise duty on fuels, a reduced ten per cent IVA rate on petrol, diesel and biofuels, and a partial rebate on commercial diesel.

Although the government decided at the end of June to withdraw those measures, it said it could reintroduce them if fuel prices rose sharply again. International organisations including the IMF and the OECD, however, have advised against such broad support unless it targets specific groups.

Core inflation, which excludes energy and unprocessed food, eased to 2.9 per cent, helped by slower price rises in some tourism-related services, according to the Ministry of Economy.

Food price inflation also continued to ease. Annual inflation for food and non-alcoholic drinks fell to 1.9 per cent in June, down from 2.2 per cent in May and the lowest level since the beginning of 2025.

On a month-on-month basis, the consumer price index (CPI) rose by 0.6 per cent in June, up from 0.1 per cent in May. The increase marked the fifth consecutive month of monthly price rises.

"The figures show that the government's response plan continues to meet its objective of cushioning the impact of the conflict with Iran on inflation and protecting households' purchasing power," sources at the Ministry of Economy said.

"Since its introduction on 20 March, the plan has reduced headline inflation by almost one per cent," they added.

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