Guatemala: Inflation eases in August
September 30, 2019
Consumer prices dropped 0.86% month-on-month in August, down from the 0.06% decrease in July. The result was driven by markedly cheaper foods and transportation.
Inflation fell from 4.4% in July to 3.0% in August, the lowest reading since December; as a consequence, inflation dropped to the lower limit of the Central Bank’s 3.0%–5.0% target range. Annual average inflation, meanwhile, edged down to 4.0% in August from 4.1% in July.
On 25 September, Banguat’s Monetary Policy Board kept the interest rate unchanged at 2.75%. The decision reflected within-target range inflation and expectations of well-anchored inflation over the medium term, while economic indicators point to growth consistent with the Bank’s 3.0%–3.8% projection. Meanwhile, the Bank also noted that while still-favorable, the global backdrop has been affected by downside risks.
Author: Jan Lammersen, Economist