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Inflation slows to 8.4% on energy price controls

Measures to contain the fall in electricity prices and rise in fuel prices slow down the progress of the CPI,…

By admin , in news , at May 13, 2022

Measures to contain the fall in electricity prices and rise in fuel prices slow down the progress of the CPI, which April closed at 8.3%, Still, it is the second highest level in nearly 40 years.

The wholesale market averaged 191 euros/MWh in the fourth month of the year, well below the price when inflation touched double digits last March. Last month, an average user paid an invoice of 124.9 euros, a 53.2% increase compared to April 2021.

The cap on the price of gas approved this Friday, which—according to experts consulted by El Debate—will reduce the electricity market to 130-150 euros/MWh. A fall in prices will push back inflation for the full twelve months in which this measure will remain in place. The INE measures the effect of energy prices by taking the pool price as a reference. About 11 million households are subscribed at a regulated rate, dependent on daily fluctuations of electricity.

Gas ceiling to be relaxed in IPC during next months

Besides statistics, another 17 million users are covered by the free market. Customers who have started experiencing a significant increase in the renegotiation of their annual contracts. Power companies have started shifting power volatility over the past year.

On the other hand, the bonus of 20 cents per liter of fuel, implemented from the beginning of April, has managed to correct the global rate of prices. This measure has prevented consumers from being forced to pay the highest price in history. Gasoline rose 2.2% during the last week to reach 1,878 euros per liter, The lesser impact of energy prices has managed to ease tensions on the rise in food prices, which moderated its growth in April.

core inflation rises

Points and asides deserve an increase in the underlying CPI—the index that subtracts the impact of the most volatile products— increased to 4.4%, its record level, The indicator promises to remain relatively high in the medium term, despite the impact of gas cap on the normal rate.

Price increases are widespread across Europe. The European Central Bank (ECB) is preparing a Rate hike for next July, The President of the Monetary Institute, Christine Lagarde, confirmed these locks last Wednesday at a conference organized by the National Bank of Slovenia.

The bank has been anticipating ECB action for weeks, which has led to an avalanche of mortgage loan applications. Users try to avoid the move that an increase in rates will lead to an increase in rates.

Inflation slows to 8.4% on energy price controls

2022-05-13 07:00:41