Spanish inflation eased for a fourth month in February as the euro area’s fourth-largest economy shrinks and high unemployment curbs demand.
Consumer prices, based on European Union calculations, rose 1.9 percent from a year earlier after a 2 percent increase in January, the National Statistics Institute in Madrid said today. Economists had expected a gain of 1.9 percent, according to the median of 12 forecasts in a Bloomberg News survey.
Prime Minister Mariano Rajoy, in power since December, is trying to convince investors and voters he can overhaul the economy and implement the deepest budget cuts in at least three decades amid a contracting economy.
Spanish gross domestic product may fall more in the first quarter than in the last three months of 2011, when it declined 0.3 percent, Deputy Economy Minister Fernando Jimenez Latorre said on Feb. 16. The unemployment rate was 22.9 percent in December, according to EU data.
The government expects inflation to slow to 1 percent this year, it said on Dec. 30. The European Commission has forecast that Spanish consumer-price growth will ease to 1.3 percent this year from 3.1 percent in 2011.