Chile: Inflation moderates in January
February 8, 2011
In January, consumer prices rose 0.3% over the previous month, broadly in line with market analyst expectations. The monthly reading reflected an increase in prices of alcoholic beverages and tobacco (+3.9% mom), brought to bear by a tobacco tax increase. In addition, transport prices rose notably on the back of higher oil prices. Annual headline inflation dropped from 3.0% in December to 2.7% in January. The core inflation index, which excludes volatile categories such as oil, fresh fruits and vegetables, rose 0.1% over the previous month, while annual core inflation moderated from 2.5% in December to 2.0% in January. The Central Bank has a medium-term inflation target of 3.0%, with a 1% tolerance margin, and currently expects inflation to close the year at 3.3% before moderating to 3.0% by the end of 2012.