The advanced Consumer Price Index (CPI) for December has concluded at 4.5%, thus marking the end of 2023. This is a much more moderate increase than a year ago when, as we recall, it reached 7.1%.

This has very direct implications, for example, in increased wages. The Government will decree that earnings between the minimum and average salary, between 1,400 and 2,400 euros monthly, should increase with inflation. This includes the vast majority of salaried workers.

In about two weeks, approximately, the definitive Consumer Price Index will be known, but usually, it does not vary much from what has already been advanced, closing the year at 4.5%. This figure is higher than in our surroundings. In Spain, it is 3.1%, and in France, it has not been disclosed yet but will likely be in similar ranges.

The data has significant implications such as the wage increases that the Government will decree, based on this inflation, for earnings between the minimum, which is 1,376 euros monthly, and the average, which is around 2,380 euros monthly. But also for the increases in housing with rentals below 8 euros per square meter that will rise, at least according to this Consumer Price Index, and, in some cases, above.

This behavior of the cost of living is mainly due to two reasons. Firstly, the price of fuels has been decreasing in recent months. Additionally, the interest rate hikes decreed by the European Central Bank have slowed economic growth, and this has prevented prices from rising as much.

For decades, we had very moderate inflation, below 2%, but in recent years, it has become uncontrolled. Among other things, due to market uncertainty caused by the invasion of Ukraine. In December 2021, the Consumer Price Index was 3.3%. It rose to 7.1% in 2022, and now it has dropped to 4.5%

Official Source: https://www.andorradifusio.ad/noticies/2023-tanca-ipc-45