Inflation rate hits 5.3% in March, highest since June 1994

The year-on-year change in the consumer price index (CPI) was 5.3% in March, compared to 4.2% in February, the highest rate since June 1994, Statistics Portugal (INE) confirmed on Tuesday.

“The year-on-year change in the CPI was 5.3% in March, up 1.1 percentage points (p.p.) from the previous month,” the “highest rate since June 1994,” INE said, confirming the figures forecast in the flash estimates released at the end of March.

The underlying inflation indicator (total index excluding unprocessed foodstuffs and energy) also accelerated, registering a variation of 3.8% (3.2% in February).

The change in the energy products index rose to 19.8%, from 15% in the previous month, which corresponds to the highest figure since February 1991.

On the other hand, the unprocessed foodstuffs index registered a variation of 5.8%, against 3.7% in February.

The monthly change in CPI was 2.5% (0.4% in the previous month and 1.4% in March 2021), while the average change over the last twelve months was 2.2% (1.8% in February).

As for the Harmonised Index of Consumer Prices (HICP), a year-on-year change of 5.5% was recorded, representing the highest rate since the inception of the HICP in 1996.

This rate is 1.1 percentage points higher than in the previous month and 2.0 percentage points lower than the figure estimated by Eurostat for the euro area, “reflecting above all appreciable differences in the behaviour of energy prices, particularly electricity,” INE noted.

Therefore, excluding unprocessed food and energy products, the HICP in Portugal reached a year-on-year change of 4.1% in March, higher than the corresponding rate for the euro area (estimated at 3.2%), “showing a very pronounced upward profile”.

The HICP recorded a monthly variation of 2.6% (0.5% in the previous month and 1.5% in March 2021) and an average variation over the last twelve months of 2.0% (1.5% in the previous month).