Guatemala: Inflation moderates in April
May 7, 2013
In April, consumer prices rose 0.17% over the previous month, which was below the 0.48% rise tallied in March. According to the statistical institute, the moderation seen in April mainly reflects lower prices for transportation and alcoholic beverages, which were compensated for higher prices in all the remaining categories.
Annual headline inflation edged down to 4.1% in April from 4.3% in March, which had represented the highest rate in a year. Accordingly, inflation remains within the Central Bank's inflation target range of 4.0% plus/minus 1.0 percentage points for this year. Meanwhile, the core inflation index added 0.18% over the previous month (March: +0.26% month-on-month), driving annual core inflation down to 3.5% (March: 3.7%).
At its 25 April monetary policy meeting, the Central Bank decided to increase the policy interest rate by 25 basis points to 5.25%. The Bank justified its decision citing a global economic recovery as well as healthy domestic demand. Regarding price developments, the Bank stated that inflation expectations have risen in recent months.
FocusEconomics Consensus Forecast panellists see inflation at 4.8% by the end of the year, which is up 0.1 percentage points from last month's estimate. Next year, FocusEconomics Consensus Forecast participants expect inflation to moderate to 4.7%.