Costa Rica: Inflation falls to six-month low in June
July 2, 2013
Consumer prices were virtually unchanged over the previous month in June, matching the performance in May. The reading reflects how lower prices for food and non-alcoholic beverages as well as for clothing and footwear almost completely offset higher prices for alcoholic beverages and cigarettes.
Meanwhile, annual inflation dropped from 5.3% in May to 5.1% in June, which marks the lowest level since December 2012. Inflation now sits comfortably within the Central Bank's target of 5.0% with a tolerance margin of plus/minus 1.0 percentage points. Despite the annual decline, annual average inflation remained stable at May's 5.2%, which had marked the highest level in two years.
Meanwhile, the core inflation index, which strips out short-term fluctuations in the consumer price index, rose 0.12% from the previous month in June, following the 0.20% rise recorded in May. Annual core inflation remained steady at 2.6% in June.
According to the Macroeconomic Programme 2013-2014, the Central Bank intends to maintain an inflation target of 5.0% (with a tolerance margin of plus/minus 1.0 percentage points) this year and the next. FocusEconomics panellists see inflation ending the year at 5.0%, which is up 0.1 percentage points from last month's forecast. For next year, the panel sees year-end inflation at 4.9%.