Costa Rica Inflation

Costa Rica

Costa Rica: Inflation continues upward trajectory and reaches over one-year high

September 2, 2014

Consumer prices increased 0.33% in August over the previous month, which came in below the 0.91% rise tallied in July. The print marked the lowest inflation rate in nine months. According to the Statistics Institute, 6 of the 12 categories that comprise the index registered price increases in August. Food and non-alcoholic beverages as well as take-out food were the categories that experienced the largest monthly gains.

Annual headline inflation increased from 5.2% in July to 5.5% in August, reaching the highest level since July 2013. As a result, inflation moved further above the Central Bank’s tolerance margin of plus/minus 1.0 percentage point around its 4.0% target. Annual average inflation remained unchanged at July’s 4.1%.

The core inflation index, which strips out short-term fluctuations in the consumer price index, rose a mild 0.09% over the previous month (July: +0.33% month-on-month). Annual core inflation came in at 3.9% in August, matching last month’s reading.

The Central Bank projects that inflation will end 2014 at 4.8% and sees it moderating to 4.6% in 2015. FocusEconomics panelists see inflation ending 2014 at 5.3%, which is up 0.2 percentage points from last month's forecast. In 2015, the panel sees year-end inflation at 5.0%.

Author: Teresa Kersting, Economist

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Costa Rica Inflation Chart

Costa Rica Inflation August 2014

Note: Annual and monthly variation of consumer price index in %.
Source: National Institute of Statistics and Census (INEC).

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