Guatemala: Inflation moderates in February
March 7, 2016
In February, consumer prices rose 0.21% over the previous month, which came in below the 0.91% rise tallied in January. February’s increase mainly reflects that higher prices for several categories, including food and restaurants, more than offset lower prices for transport.
Inflation inched down from 4.4% in January, which was the highest reading in over two years, to 4.3% in February. The result kept inflation within the Central Bank’s tolerance margin of plus/minus 1.0 percentage points around its target of 4.0%.
At its 24 February monetary policy meeting, the Bank of Guatemala decided to keep its policy rate at 3.00%. In its brief press release, the Bank stated that it expects moderate global growth going forward, with risks tilted to the downside. Regarding the domestic economy, the Central Bank pointed out that economic activity was dynamic, with remittances, the monthly indicator of economic activity and private sector credit all performing solidly. As for price developments, the Bank said that prices for commodities, particularly oil, remain at historic lows, thus containing inflationary pressures. The Bank added that it expects inflation to be remain within its target range this year.