Including last month's 0.2% rise, the Consumer Price Index (IPC) finished the year at 3.7%, 0.5% higher than the annual rate for 2004, and 1.7% above the government's official forecast, according to figures published today by the National Statistics Institute (INE). The underlying causes of the worst inflation figures since 2002, when inflation stood at 4%, has been increased fuel and fresh food prices. The underlying rate of inflation, which excludes fuel and fresh food prices, was 2.9% after a 0.3% rise during December. The figures show that fuel prices rose 13%, energy prices rose 9.9%, while fresh food prices rose 5.2%.

Transport costs rose 6.2%, driven by increased fuel and lubricant costs, housing rose 6%, alcohol and tobacco rose 5.1%, hotels, cafés and restaurant prices (4.2%), and food and non-alcoholic drinks prices rose (4.2%). The cost of education rose 4.1%, other goods and services (3.4%), household furnishing (2.2%), clothes and footwear (1.4%), medicine (0.7%), and the cost of leisure and cultural pursuits (0.6%). Communication costs were unique in registering negative inflation (-1.7%). Within food, top of the list was oil (24.5%), followed by lamb (18.3%), and fresh vegetables (11.4%).

By region, above average inflation was registered in La Rioja (4.4%), Cataluña (4.3%), Murcia (4.1%) and Aragón and Castilla La Mancha (3.8%), while in Castilla León, Galicia, Madrid, Navarra and the Basque country, inflation was at the national average  (3.7%). Below average inflation was registered in Andalucía and Cantabria (3.6%), Asturias, the Balearic Islands and the Valencia Community (3.5%), Extremadura (3.1%) and the Canary Islands (2.8%).