Monday, October 2, 2023

Inflation is providing some respite, falling to 6.1% in the euro zone in May, with Spain leading the decline

Inflation is providing a reprieve in the euro zone, falling nine-tenths to 6.1% in May after a slight rebound last month. With a minimum since July 2021, Spain is at the forefront of this price reduction with a rate of 2.9%, increasing its gap with the rest of its European partners, with the exception of Luxembourg (2%) and Belgium (2.7%), as data from Eurostat shows statistics office.

Another disinflationary sign: industrial companies lowered their sales prices in April for the first time since 2020


Price increases are also slowing in the other major economies of the Eurozone, although rates remain significantly higher than in Spain. Italy remains at 8.1% despite a decline of seven tenths. Germany is at 6.3% compared to 7.6% and France at 6%.

The main cause of inflation relief is the reduction in energy prices, which fell by 1.7%. Prices for food, alcohol and tobacco also increased less (from 13.5% in April to 12.5% ​​in May).

Core inflation, which excludes energy and unprocessed food due to its more volatile behavior, also slowed its growth by four tenths (from 7.3% to 6.9%).

May thus resumed the trend of easing in price increases, which was interrupted in April after several months of declines, having reached a historic record (10.6%) in October. However, the interest rate that the European Central Bank takes into account when setting monetary policy – which excludes energy, all food (processed and unprocessed), alcohol and tobacco – remains above (5.3%) from 2% the institute headed by Christine Lagarde has decided to reconsider interest rate increases.

Unemployment remains at a low level, having fallen by a tenth compared to the previous month and stands at 6.5% in the eurozone. Among the 27, the unemployment rate remains stable at 6%. By country, Spain is the country with the highest unemployment rate (12.7%), although membership has reached a record high of 20.6 million people. Greece follows again (11.2%).

Nation World News Desk
Nation World News Desk
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