Spain’s year-on-year inflation rate in December 2024 increased to 2.8%, from 2.4% in November, according to the National Statistics Institute (INE). This was in line with analyst expectations. It was also the highest figure since July last year. December was the third consecutive month of growth. 

The rate was primarily because of base effects, as well as a rebound in transport prices, which grew 0.6% in December, from -0.1% in November. Culture and recreation prices increased to 3.2% in December from 2% in the previous month, mainly because of rising tourist package prices. 

Spain’s year-on-year core inflation rate for December came up to 2.6%, which was a four-month high, in contrast with November’s 2.4%. This was also in line with market expectations. Core inflation does not take energy and food prices into account due to their inherent volatility. 

Month-on-month inflation came up to 0.5% in December, from November’s 0.2% – more than analyst estimates of 0.4%. 

Spanish inflation expected to touch 2.2% in 2025

The European Commission expects Spanish inflation to average about 2.2% in 2025, before dropping to 2% in 2026, in line with the European Central Bank’s target. It also expects Spain’s gross domestic product (GDP) growth rate to be 2.3% this year, before falling to 2.1% next year. 

Spanish financial services companyCaixaBank also expects Spain’s core inflation to touch 2% this year – and for 2025 to be a robust one for the country’s economy, mainly because of rising private domestic demand. 

However, the company highlights that if geopolitical risks worsen, this may dampen economic growth. These include a tariff war between the US and EU, or EU and China, as well as an escalation of Middle Eastern conflicts, which may push up energy prices.