Dominican Republic: Central Bank raises policy rate for third time in 2011
April 29, 2011
In March, consumer prices increased 1.16% over the previous month. The monthly increase reflected higher prices for transport, as well as for food, alcoholic beverages and tobacco. The reading was virtually unchanged from the 1.20% rise recorded in February but was above the 0.86% increase recorded in March 2010. Accordingly, annual headline inflation jumped from 7.3% in February to 7.6%. At the current level, inflation sits above the upper limit of the 5.0%-6.0% target range set by the Central Bank for 2011 for a fourth consecutive month. As a consequence, at its 29 April meeting, the Bank decided to raise the monetary policy rate by 25 basis points to 6.50%. The decision marked the third tightening move since the beginning of 2011, following on a 25 basis points hike in March.
Author: Armando Ciccarelli, Head of Data Solutions