Annual inflation rises to 1.5% in July

The Consumer Price Index (CPI) rose 1.5% in July compared to the same month in 2020, up 1.0 percentage point from June, Statistics Portugal (INE) announced on Wednesday.

In a statement, the INE said that “this acceleration essentially reflects the dissipation of base effects”.

The core inflation indicator (total index excluding unprocessed food and energy) registered a year-on-year change of 0.8% in July, against -0.3% in June.

The monthly change in the CPI was -0.3% in July, down from 0.2% in June and -1.3% in July 2020.

The average change over the last twelve months was 0.4%, compared to 0.3% in June.

The INE says that the Portuguese Harmonised Index of Consumer Prices (HICP) rose 1.1% in July compared to the same month in 2020, 1.7 percentage points more than in June and 1.1 percentage points less than the value estimated by Eurostat for the euro area (in June 2021, this difference was 2.5 percentage points).

The oscillation of the differential of the Portuguese HICP in year-on-year terms compared to the euro zone is partly associated with the lack of synchrony of the impacts of the pandemic in the various countries, which generate base effects of different magnitudes, said the INE.

The HICP recorded a monthly change of -0.4% in July, compared to 0.2% in the previous month and -2.0% in July 2020 and an average change over the last twelve months of -0.1%, compared to -0.2% in June.