The rate of overall Spanish inflation has fallen below 3% for the first time in almost two years — but households still face soaring costs for ingredients such as rice and olive oil as food price increases remain stubbornly high.
Bloomberg’s Paella index, which calculates the amount spent on items needed to make the traditional dish, rose 14% in May from a year earlier. The custom gauge, which crunches data from the country’s National Statistics Institute, compares with an overall pace of inflation of just 2.9% and is two percentage points faster than the national rate for food of 12%.
Prices for some key ingredients continue to soar, including for olive oil, which is up 24.7% from a year earlier, accelerating from April’s 22.2% rise. Rice also surged 21.5% in May from a year ago, although the pace eased slightly from 23% the previous month.
Spanish Prime Minister Pedro Sanchez’s government confirmed Monday that it will maintain anti-inflation measures announced six months ago to ease the burden of higher food prices, extending VAT cuts on some staples. The decision came as he faces a national snap election on July 23.
