Venezuela: Inflation gains momentum at the outset of the year
February 8, 2013
In January, the consumer price index for the Caracas Metropolitan Region rose 3.26% over the previous month, which was above the 2.91% increase tallied in December. The print overshot market expectations that had prices rising 2.43% and marked the largest monthly gain since January 2011. The monthly price increase was mostly buttressed by higher prices for food and non-alcoholic beverages as well as for culture and recreation.
Building on the monthly increase, annual headline inflation rose from 19.5% in December to 21.6% in January, which represents the highest reading observed since May 2012. Meanwhile, the core inflation index, which excludes volatile items such as fresh food, oil and other goods subject to government price controls, rose 3.35% over the previous month, up from the 2.55% increase tallied in December. As a result, annual core inflation rose from 21.5% in December to 23.6% in January.
According to the 2013 budget, the Venezuelan government expects inflation to range between 14% and 16% by the end of this year.