- Spain October preliminary CPI +4.9% vs +4.9% y/y expected
- Prior +4.9%
- Spain October preliminary HICP +4.9% vs +4.9% y/y expected
- Prior +5.0%
Spanish inflation continues to hover around 5% in October, as the preliminary estimates continue to paint a rather uncomfortable picture for the most part. Headline annual inflation remains steady at 4.9% while the harmonised reading eased marginally to 4.9% as well. So, that’s not saying a lot after the run higher in the past few months amid a surge energy prices due to the Middle East conflict.
And with higher oil prices continuing to stick, that will certainly add to the inflation headache in Q4.
Looking at the details, core annual inflation is seen at 3.1% – unchanged compared to September. But at this level, it is still well above what the ECB would be comfortable with as price pressures continue to pull away from the 2% target.
Alongside the earlier report from France, this just continues to reaffirm that the inflation monster is getting bigger and more threatening for the central bank. But at the same time, flagging economic growth conditions will just mean that stagflation risks are also on the rise.
So, that is quite a troubling spot for policymakers to be in as they have to try and deal with price pressures before they get out of hand while avoiding sending the broader economy off a cliff. Tough.
This article was written by Justin Low at investinglive.com.