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Spanish inflation was lower than expected in September, with the annual pace of price growth holding steady from August rather than ticking up.

High energy costs kept the year-on-year rate of consumer price growth at 2.2 per cent on an EU-harmonised measure, flash data published by Spain’s national statistics agency (INe). But there was no further increase to 2.3 per cent, which was what had been anticipated by economists polled by Reuters.

The pace of inflation has remained above 2 per cent since mid-2018, when energy prices soared across Europe.

INe said the pace of growth has steadied, however, because price growth in food and non-alcoholic beverages has moderated.

On Friday INe also released data confirming that Spanish economic growth had slowed to the lowest rate in four years in the second quarter of the year, in the latest sign that economic growth in the euro area moderated in the first half of the year after a heady 2017.

Spain’s gross domestic product grew at an annualised pace of 2.5 per cent in the quarter, slower than the 2.7 per cent that had been expected.

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On a quarter over quarter basis, the Spanish economy grew by 0.6 per cent, in line with expectations.

Spain has been enjoying an economic revival boosted by high net exports and strong job creation.

In their latest economic survey of Spain, the OECD had said it expected the country’s economy to grow at a robust, but more moderate pace in 2018 and 2019 and forecast inflation to remain moderate.

“More effective labour market policies and re-skilling are needed to further reduce unemployment and inequalities, and make growth more inclusive,” the OECD said.

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