Inflation gives no respite to families and the Spanish economy maintains growth

BarcelonaThe prices of goods and services that families habitually consume have continued to rise this month of October in the State, according to advance data from the Consumer Price Index (CPI, the indicator that measures the cost of living for families) published this Friday by the National Statistics Institute (INE), despite a moderation in fuel prices. Furthermore, the state statistical agency has also published preliminary data on the evolution of the Spanish economy between July and September, which maintained its pace of growth and continues to expand above the European average.

Thus, the cost of living increased by 0.6% compared to September, a growth rate that doubles that recorded between last month and August. This has placed prices 4.9% above October 2025, the same year-on-year difference as last month.

In relation to a year ago, the INE highlights in a statement that vehicle fuels, which this year had been the main element of growth in the CPI due to their sharp price increase following the war in Iran, have pushed the inflation rate downwards, as have food and clothing. Conversely, the price of natural gas, liquid fuels, and tourist packages have been the elements that have most increased the cost of living.

The data became known with less than two weeks to go before the general strike to protest against the rising cost of housing and low wages: in fact, one of the reasons for the call is to make clear "the indignation of the majority of the country for an economic model that transfers to prices and the consumption of basic goods the corporate margins to cover the cost increases of the energy crisis caused by the infamy of wars".

With these inflation figures, Spain remains well above the 2% annual target set by the European Central Bank (ECB), which kept interest rates unchanged on Thursday but will foreseeably increase them at its last meeting of the year next December. If it were to do so, it would add more pressure to families, especially those with variable-rate mortgages and consumer loans, as a rise in the price of money would mean an increase in the installment they have to pay.

Unlike what is usual when macroeconomic data such as the CPI or GDP are released, on this occasion the Ministry of Economy has not published any reaction to the data, as the executive is focused on the management of the railway accident in Toledo.

GDP maintains growth

In addition to the inflation data, this Friday the INE also released a first preview of how the Spanish economy evolved in the third quarter of this year. Thus, Spain's gross domestic product (GDP, the indicator that measures the size of an economy) expanded by 0.6% between July and September, with an increase of 2.7% compared to the same period in 2025. These figures are similar to those of the previous quarter, when the Spanish GDP increased by 0.7% with respect to the first three months of the year and by 2.6% year-on-year.

Family demand continued to be the main driver of the economy, with a quarterly increase of 0.6% and an annual increase of 3.1%. This strength in household spending is due to the high Social Security affiliation figures and is one of the elements that explains the growth differential of the Spanish economy in recent years. In this sense, according to data from Eurostat —the community statistical agency—, the countries of the eurozone grew on average by 1.3% annually during the summer months and the 27 states of the European Union as a whole by 1.5%, notably below the 2.7% of Spain, a pattern that has been repeating since 2023.

As in the case of households, public sector spending also maintained its robustness with an increase of 0.9% between June and September, placing it at levels 2.5% higher than those of the third quarter of last year. On the other hand, the bad news came from the slowdown in both investment —it grew by a slight 0.1% and stood 2.1% above the levels of a year earlier— and exports, which slowed by two tenths to 1.3% quarterly, but which maintained good annual growth rates, with 3.6%. Imports also slowed down but continued to rise, by 1.1% compared to the second quarter and by 3.9% annually.

By sector, services, which represent more than two-thirds of GDP, were once again the main engine of Spanish GDP growth, with a quarterly increase of 0.7% and 2.9% annually. Industry, a priori the sector most affected by geopolitical instability and rising energy costs, handled the situation well with an increase of 0.7% compared to the April-June period and 2.1% year-on-year. However, within the industrial sector, manufacturing did grow at a lower rate —but remained positive despite the adverse international context—, with increases of 1.7% annually and 0.4% quarterly.

Construction activity stood 2% above the levels of a year ago, but this increase is due to the rises in previous quarters, as it did not grow between July and September. Regarding the primary sector, the summer months brought an increase in its activity of 1.5% compared to the previous three months and 7.1% in relation to the same period of 2025.

The INE will release more detailed GDP data on December 14, while on November 13 it will expand the October CPI data, also broken down by autonomous communities.