Guatemala: Inflation continues to build up
March 7, 2013
In February, consumer prices rose 0.82% over the previous month, which came in above the 0.49% increase seen in January. According to the statistical institute, the monthly print mainly reflected a strong increase in prices for transport as well as for food, whereas prices for alcoholic beverages declined sharply.
Annual headline inflation rose from 3.9% in January to 4.2% in February. The print marks the highest rate in 10 months but, nevertheless, still remains within the Central Bank's inflation target range of 4.0% plus/minus 1.0% for this year. Meanwhile, the core inflation index added 0.50% over the previous month (January: +0.41% month-on-month), driving annual core inflation to 3.7% (January: +3.5%).
At its 20 February monetary policy meeting, the Central Bank decided to maintain the policy interest rate unchanged at 5.00%. The Bank justified its decision citing healthy economic growth at home as well as relatively subdued inflationary pressures.
FocusEconomics Consensus Forecast panellists see inflation at 4.7% by the end of the year, which is down 0.3 percentage points from last month's estimate. Next year, FocusEconomics Consensus Forecast participants expect inflation to moderate to 4.4%.