Venezuela: Headline inflation continues to rise in December
January 9, 2012
In December, the consumer price index for the Caracas Metropolitan Region rose 1.78% over the previous month, which came in below the 2.23% price increase recorded in November, but broadly in line with Consensus Forecast expectations that had prices increasing 1.82%. The monthly increase was driven by higher prices for restaurants and hotels, as well as for transportation due to a recent increase in state-set prices. Annual headline inflation inched up from 28.9% in November to 29.0% in December and thus continued to gain momentum for the ninth month in a row. As a result, inflation ended 2011 above the 27.4% recorded in December 2010. Meanwhile, the core inflation index, which excludes volatile items such as fresh food, oil and other goods subject to government price controls, rose by 1.91% in December, which is down from the 2.36% seen in November. As a result, annual core inflation also ticked up from 30.8% in November to 30.9% in December. According to the 2012 budget, the Venezuelan government has estimated that inflation will fall to between 20% and 22% this year.