14 Aug 2008

Spanish inflation at 15-year high

1:26 pm on 14 August 2008

Prices in Spain rose at their fastest annual rate for 15 years in July, driven by rising food and fuel costs.

The annual inflation rate climbed to 5.3% in July, up from 5% in June.

Transport costs were 10.6% higher than a year earlier, the National Institute of Statistics said, with food prices up 7% compared with July 2007.

Spanish inflation is above the eurozone average of 4.1%, but recent falls in the price of crude oil could bring the rate down.

Economy Minister Pedro Solbes said the rate of inflation could drop to about 4% by the end of the year as crude prices have declined.

Later on Wednesday Spain set out a number of economic reforms aimed at tackling the cooling economy.

The plan, yet to be finalised, included a €20 million package ($US30m) to help families access finance for mortgages and to help smaller firms among others.