Consumer prices in Spain fall for 6th straight month

Consumer prices in Spain fell for the sixth consecutive month in a row, fuelled by economic turmoil in the Eurozone, concerning UK’s Brexit referendum that surprised markets last week. However, the fall was slower than what markets had expected.

The consumer price index dropped 0.8 percent year-over-year in June, just below economists' expectations for a 0.9 percent decline. It was also slower than the 1.0 percent fall in May, preliminary data released by the statistical office INE showed Wednesday.

However, on a monthly basis, consumer prices climbed at a stable pace of 0.5 percent in June. The EU measure of inflation, or HICP, slid 0.9 percent annually in June, slower than the 1.0 percent decline expected by economistsThe harmonized index of consumer prices rose 0.4 percent m/m in June as against the expected rate of increase of 0.3 percent.

Further, a negative interest rate in the Eurozone has failed to stall hopes of inflation in the area, although President Mario Draghi has repeatedly said that he and other senior bank officials are convinced that the measures are working.

Meanwhile, the central bank has expressed it wants to follow a wait and see approach with current monetary policy before making any further adjustments. However, inflation has remained in negative territory during the first half of 2015, but after rising in the second half of the year, it has weakened again in 2016.