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INE Confirms That The CPI Climbed To 2.7% Annually In May

In 34 years there was not so much gap between core inflation (0.2%) and general

The INE confirms that the CPI climbed to 2.7% annually in May, its highest rate since February 2017. Inflation climbs to levels unknown for four years.

The increase in May was mainly contributed by the price of gasoline. In 34 years there was not so much gap between core inflation (0.2%) and general.

The Consumer Price Index (CPI) rose 0.5% in May compared to April and placed its interannual rate at 2.7%, five tenths above that of April (2.2%), according to the data published this Friday by the National Institute of Statistics (INE), which confirm the advanced data on May 31 .

With this rebound, the annual CPI chains its fifth consecutive positive rate and inflation scales to levels unknown for four years; Such a high CPI rate had not been reached since February 2017, when it stood at 3%.

The rise in prices of gasoline, cars, oils and fats and diesel for heating have contributed especially to the increase in prices in May. Tourist packages and fish and seafood, whose prices fell in May 2020 more than this year in that same month.

In monthly rate (May over April), the CPI rose 0.5%, seven tenths less than in April (and one tenth more than in the advance data estimate) and its third consecutive positive rate.

In this case, the groups that most influenced the monthly increase were clothing and footwear, transport, food and non-alcoholic beverages (less legumes and vegetables, which fell). Housing and hotels, cafes and restaurants contributed to the decline.

The largest gap between the underlying and the general rate in 34 years
Regarding core inflation (which does not take into account unprocessed food and energy products) the interannual rate in May stood at 0.2%, two tenths more than in April and 2.5 points lower than the general index . This is the largest gap between the underlying and the general rate in 34 years, since August 1986.

For its part, the Harmonized Consumer Price Index (HICP) increased its interannual rate by four tenths in May, to 2.4%, while it rose 0.5% in the monthly rate.

The ECB improves growth for this year to 4.6%, but warns of a rebound in inflation to 1.9%.

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