Dominican Republic Inflation October 2016

Dominican Republic

Dominican Republic: Inflation slows in October

November 10, 2016

In October, consumer prices in the Dominican Republic rose 0.30% from the previous month, which followed the 0.04% increase observed in September. According to the Central Bank, the increase mainly reflected higher prices for transport and housing.

Inflation in October edged down to 0.9% from September’s 1.4%, marking a 13-month low and keeping headline inflation well below the lower bound of the Central Bank’s tolerance margin of plus/minus 1.0 percentage point around its 4.0% target rate. Annual average inflation inched down from September’s 1.8% to 1.7%.

At its meeting on 30 October, the Central Bank decided to raise its monetary policy rate to 5.50% from 5.00%, taking into consideration the good performance of GDP in the first three quarters of the year, the upside inflation risks resulting from rising oil prices and the possible capital flight associated with future rate hikes by the Fed.

FocusEconomics Consensus Forecast participants expect inflation to end 2016 at 2.1%, which is unchanged from last month’s projection. Panelists project inflation of 3.0Error! Not a valid link.% in 2017, which is up 0.1 percentage points from last month’s forecast.

Author: Massimo Bassetti, Economist

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Dominican Republic Inflation Chart

Dominican Republic Inflation October 2016

Note: Annual and monthly variation of consumer price index in %.
Source: Dominican Republic Central Bank.

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