The Consumer Price Index (CPI) annual rate decreased to 4.0% in May 2023 (5.7% in April 2023). This deceleration mainly reflects the base effect related to the price increases in electricity, gas and food products, registered in May 2022 and the exemption of VAT for several essential food items. A purely mechanical exercise points out to an estimated impact of this exemption of about 0.8 percentage points in the rate of change of the overall CPI. The annual core inflation rate, which excludes energy and unprocessed food products was 5.4% (6.6% in the previous month). The annual rate of change for energy products decreased to -15.5% (-12.7% in April 2023) and the index for unprocessed food was 8.9% (14.1% in the previous month). 

The CPI monthly rate was -0.7% (0.6% in April and 1.0% in May 2022), while the CPI 12-month average rate was 8.2% (8.6% in the previous month). 

In May 2023, the Portuguese Harmonised Index of Consumer Prices (HICP) annual rate was 5.4% (6.9% in the previous month). This rate is 0.7 percentage points (p.p.) below the figure estimated by Eurostat for the Euro area (in April, the Portuguese rate was 0.1 p.p. above the Euro area). Excluding energy and unprocessed food products, the Portuguese HICP was 7.3% in May (8.2% in April), above the corresponding rate for the Euro area (estimated at 6.9%).