Andorra Inflation Surges to 4.9% in April, Highest Since 2024, Fueled by Transport Costs

Andorra's advance consumer price index for April reached 4.9%, up 0.8 points from March's 4.1% and the highest level since April 2024's 3.9%. The Department of Statistics released the figure on Monday, based on 97% of updated prices from the consumption basket, with final data due on May 14.

Transport costs, driven by fuel price hikes linked to Middle East tensions including the US-Israel strike on Iran, led the year-on-year increase. Food and non-alcoholic beverages added modestly, while housing, water, gas, electricity and other fuels, along with miscellaneous goods and services, provided some moderation. The monthly rise hit 1.2%, again dominated by transport, with smaller contributions from housing, food and miscellaneous categories.

Current fuel prices average €1.59 per litre for 95 octane petrol and €1.72 for diesel, higher than Spain's €1.55 and €1.54 respectively but below France's €1.88 for SP98, €1.78 for SP95-E10 and €1.84 for diesel. Spain saw weekly increases of 4.8% on petrol and over 7% on diesel, yet its advance CPI stands at 3.2%, down 0.2 points from March. France recorded 2.2%, up 0.5 points monthly. Andorra's rate significantly outpaces both neighbours.

Government ministers urged caution amid the surge. Finance Minister Ramon Lladós said officials are "far from taking measures," noting prices remain below June-July 2022 peaks from the Ukraine war—even lower when inflation-adjusted. He highlighted recent but not ongoing talks with the Andorran Fuel Importers and Distributors Association (Assidca), stressing any aid would target residents, as tourists consume three-quarters of fuel. "We would ask for an effort from everyone," he added, citing stable electricity prices and permanent free national bus services as existing supports.

Economy Minister Conxita Marsol attributed the jump to a low base effect from last April's cheaper fuel, with housing stable and food up around 0.7%. Andorra's road transport dependence amplifies vulnerability, she said, but structural measures like free buses—unlike temporary ones elsewhere—aid households. Both emphasised close monitoring without hasty action.

Separately, the IMF warned of a sustained economic slowdown, projecting GDP growth from 3.9% in 2025 to 2.1% in 2026 and around 1.5% by 2030. External shocks like regional conflicts, energy costs and imports, plus internal challenges including population ageing and housing shortages, drive the deceleration. Inflation is expected to stabilise near 3% next year.