Spain’s Inflation Rises to 2.8% in December, Driven by Transport and Recreation Costs

Spain’s inflation rate climbed to 2.8% in December 2024, up from 2.4% in November, according to the National Statistics Institute (INE). This marks the third consecutive month of inflation growth. The rise was primarily fueled by increased transport and cultural prices.  

Factors Driving Inflation

Transport prices rebounded in December, rising 0.6% compared to a decline of 0.1% in November. Prices for culture and recreation also surged to 3.2%, driven by higher tourist package costs. Spain’s core inflation, excluding energy and food prices, reached 2.6%, a four-month high.

Economic Outlook for 2025

The European Commission projects Spain’s inflation to average 2.2% in 2025 and 2% in 2026. GDP is expected to grow by 2.3% in 2025, slowing to 2.1% in 2026.  CaixaBank forecasts core inflation to reach around 2% this year. Private domestic demand is expected to support economic growth. However, geopolitical risks could hinder growth and increase energy prices. These inflationary pressures and potential geopolitical risks could impact metal prices and demand in Spain.