Inflation is cruel to the vulnerable and already subtracts 16,700 million purchasing power from families

• Is Vladimir Putin to blame for the rise in prices in Spain, as Pedro Sánchez says?

If a family consumes the same goods and services this year

that it purchased last year, it will have to

than in 2021 to be able to pay for them.

on purchasing power

, which in March was 9.8%, the highest recorded in Spain since May 1985.

In aggregate terms for the entire Spanish economy, this translates into a

of households of

, according to the Savings Banks Foundation (

), and provided that inflation gradually decreases over time. of the year and manage to close the year at an

.

For that, the IPC should rise 6.5% each month between now and the end of the year.

If the average is above, the decrease in purchasing power will be greater.

Today, with the rise in prices of 6.1% in January, 7.6% in February and 9.8% in March,

, but the Experts expect it to drop slightly throughout the year until it can be one point lower on average, at 6.8%.

Historical evolution of inflation

Although the blow of inflation affects everyone, it does not do so with the same incidence, since it depends on the composition

of each one

Thus, although the INE publishes the inflation data for the whole of Spain, significant differences can be seen by autonomous community, just as there are between households.

Those houses -or regions- that dedicate a greater proportion of their total consumption to paying for electricity, gasoline and food, will suffer

These are traditionally

since upper-middle class households allocate a greater part of their income to other leisure activities or the purchase of other products.

By

, this difference is also observed.

Regions in which aggregate consumption is focused more on basic necessities have higher inflation rates (in February

or 8.5% in Aragón and Castilla y León), while those with higher per capita income levels and in which families have a broader and more diversified consumption basket, suffer lower inflation (

in February, for example, the latest data available).

When the INE confirms the data for March in the middle of the month, the regional breakdown will be known.

Although the main reason for the rise in the Consumer Price Index (CPI) is the

-the rise in the prices of electricity, gas and fuel-, as it is a good that all companies and families have to consume, it it has produced a

It is more expensive to do the shopping, go to the hairdresser or a new coat.

Proof of this is that

, which does not take into account the price of energy or fresh food, stood at

in March , its highest level since 2008.

The rise in prices in Spain far exceeds what is taking place in other European countries.

This same Wednesday it was known that the

in March rose by

its maximum in the last forty years, but a much lower increase than in our country.

France and Italy

will publish inflation data this Thursday, but according to analysts at consultancy Capital Economics "inflation in those countries is also likely to far exceed consensus forecasts of 4.8% and 7.2%, respectively." And it is likely that the provisional inflation rate of the euro zone will far exceed the consensus forecast of 6.6%", but even so they will not have figures as high as the Spanish one.

This gap affects the

of Spanish companies, whose costs rise more than those of other countries and may be forced to raise their final prices even more.

If your prices are higher than those of other foreign companies in the same sector, the latter will be more likely to sell.

Impact of inflation

The rise in inflation acts as an

that affects many areas of the economy, in addition to the loss of purchasing power for families and competitiveness for companies.

The rise in prices also causes a

that Funcas calculates will be

, since families will try to moderate the impact on their income by consuming less.

That drop in consumption, analysts warn, could be even higher

.

Now, they will use part of them to be able to face higher prices.

In the business sphere, the increase in prices and costs will generate a

investment

.

In addition, given that the rise in prices and the differential with Europe will reduce the competitiveness of Spanish companies, this could translate into a

compared to what was expected.

As consumption, investment and net exports are fundamental components of the

, a fall in these items will translate into

On the other hand, the price increase will

, since the Government deploys measures that involve an

(such as the rebate on fuel or direct aid) and will also be forced to disburse more in the indicated items to inflation, such as

.

The increase in

is another collateral effect, since the rise in prices automatically generates demands from the unions, who ask for an

"It is essential that the Government urgently apply price containment measures. To prevent the impact of inflation from leading to increases in inequality or poverty,

and jobs be maintained. Otherwise , the worst consequences will be for the workers," said

Conforms to The Trust Project criteria

Know more

• Europe

• INE

• UGT

• GDP

• Germany

Prices The Government will feed inflation if it focuses on giving aid in the face of tax cuts

According to AirefHacienda, it is collecting 3,500 million euros more per year of VAT due to inflation

CrisisThe Government admits that inflation existed before the war, but anticipates that it will worsen and that its impact "will last for years"

See links of interest

• Last News

• Oscar Winners 2022

• When does the 2021 Income start?

• Income 2021

• Work calendar 2022

• Economy Podcast

• Paula Badosa - Jessica Pegula, live