Power costs drive Spanish industrial prices to new record high in March

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Road lamp posts are seen next to high-voltage power lines as cars drive at dusk in the outskirts of Madrid

(Reuters) – Spanish industrial production prices rose at a record annual rate for the sixth straight month in March, pushed up by soaring energy costs, data from the National Statistics Institute (INE) showed on Monday.

Prices rose 46.6%, the fastest pace since the data series began in January 1976, led by a 134.6% increase in energy costs when compared to the same month last year.

Russia’s invasion of Ukraine has exerted additional pressure on power costs in Europe as the bloc’s countries look for options to reduce their dependence on Russian gas.

Prices of refined products, electricity, transport and distribution led Spanish industrial price increase in March, INE said, as energy prices reached their highest rate since the beginning of the series.

Companies tend to pass on industrial price rises to customers, fuelling inflation, which in Spain is running at its fastest pace in 37 years.

Spain’s central bank raised earlier this month its inflation expectation for the full year to 7.5% from a previous 3.7% as Russia’s invasion of Ukraine will further impact energy costs.

INE revised up the year-on-year February increase to 41.2% from a previous 40.7%.

(Reporting by Aida Pelaez-Fernandez; editing by Inti Landauro and Emelia Sithole-Matarise)