Inflation jumped to 1.8% in October under pressure from fuel and electricity

Inflation was 1.8% in October, up three tenths from the 1.5% recorded in September last year, according to data released today by the National Institute of Statistics (INE). The rise follows prices prices increased in October by 0.6% compared to the previous month. Overall, the price boom remains below 2%, the European Central Bank’s benchmark threshold, but breaks four straight months of decline. Core inflation, in turn, which does not take into account the most volatile elements of the basket – energy resources and unprocessed food products – is 2.5%.

These data suggest that experts’ forecasts made last month may turn out to be correct and inflation will once again exceed the 2 percent threshold by the end of the year. This, as CEOE explained in a September statement, is because prices are driven by “rate of lifting anti-inflationary measures and prices of raw materials in international markets.

Regarding the first, we must remember that from 1 October, food products subject to a 0% VAT rate began to be taxed at a 2% rate as part of the process of phasing out the financial assistance launched by the government to soften the impact of inflation on households.

INE, for its part, attributed the rise in the consumer price index in October to rising fuel prices and, to a lesser extent, rising prices for electricity and gas. compared to the decline they experienced in October 2023.