Colombia: Inflation falls in June for eleventh consecutive month
July 6, 2017
In June, consumer prices rose 0.10% from the previous month, which was below May’s 0.47% reading and market expectations of a 0.70% increase. According to Colombia’s National Statistics Institute (DANE), June’s print was mainly driven by higher prices for leisure and housing, which more than offset lower prices for food.
In June, inflation came in at 4.0% (May: 4.4%), which is the lowest reading since July 2015. Since reaching a multi-year high of 9.0% in July last year, inflation has continuously fallen as a result of the Central Bank’s tightening cycle as well as the fading of temporary supply shocks that had fueled price pressures in the past. Inflation is finally within the Central Bank’s tolerance margin of plus/minus 1.0 percentage point around its 3.0% target.
Core consumer prices, which exclude volatile items such as fresh food and fuels, increased 0.19% from the previous month in May (the latest month for which data is available), which was slightly below the 0.53% rise recorded in April. Finally, core inflation was stable in May at April’s 6.4% reading.
Author: Luis Lopez Vivas, Economist