In February, consumer prices rose 1.66% over the previous month, which was below the 2.44% increase recorded in January. The print exceeded market expectations of a 1.00% increase. According to the Statistical Institute, the monthly rise in consumer prices was mainly driven by higher prices for food and non-alcoholic beverages as well as for household items. Annual inflation rose to 9.8% in February, which was up from the 9.1% tallied in January and marked the highest value since August 2004. Consequently, inflation remains well above the Central Bank's target range of 4.0%-6.0%. On 11 March, Finance Minister Mario Bergara unveiled a legislative initiative to fight supply-side inflation. The measures include VAT reductions in electricity and telecommunications and in fruits and vegetables. Higher prices for fruits and vegetables pushed inflation higher in previous months. Bergara argued that the measure, “does not fight structural inflation,” but avoids supply-side, “temporary situations, such as floods,” which have contributed to price increases in the first months of the year. The measures will be presented to Parliament and during the week of 17-23 March. Economic analysts estimate that the implementation of these tax measures will reduce tax revenues by USD 100 million. LatinFocus Consensus Forecast participants expect inflation to drop to 8.1% by the end of 2014, which is up 0.1 percentage points from last month's projection. For 2015, panelists see inflation at 7.5%.
Government plans to cut VAT as inflation reaches near-decade high in February
March 13, 2014
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Uruguay Inflation Chart
Note: Annual and monthly variation of consumer price index in %.
Source: National Statistical Institute (INE).
Uruguay Economic News
October 13, 2016
In August, industrial production grew 2.0% from the same month last year, which contrasted the 5.4% drop recorded in July and marked the best result in six months.
October 6, 2016
In September, consumer prices increased 0.3% over the previous month, down from August’s 0.6% rise.
September 21, 2016
Uruguay’s economy expanded 1.4% year-on-year in Q2 2016, which represented an acceleration over Q1’s revised 0.1% growth (previously reported: -0.5% year-on-year).
September 12, 2016
In July, industrial production contracted 5.4% over the same month last year, which was sharper than the 3.4% decrease in June and represented the fourth consecutive contraction in Uruguay’s industrial output.
September 5, 2016
In August, consumer prices increased 0.6% over the previous month, up from July’s 0.4% rise.