Venezuela: Inflation hits 10-month high in February
March 7, 2013
In February, the consumer price index for the Caracas Metropolitan Region rose 1.41% over the previous month, which represents a remarkable deceleration over the 3.26% increase tallied in January. The print undershot market expectations that had prices rising 1.90% and marked the smallest monthly gain since August 2012. The reading mostly reflected higher prices for restaurants and hotels as well as for culture and recreation. On the other hand, food and non-alcoholic prices fell over the previous month.
Building on the monthly increase, annual headline inflation rose from 21.6% in January to 22.1% in February, which represents the highest reading observed since April 2012. Meanwhile, the core inflation index, which excludes volatile items such as fresh food, oil and other goods subject to government price controls, rose 3.29% over the previous month, slightly down from the 3.35% increase tallied in January. As a result, annual core inflation jumped from 23.6% in January to 26.1% in February.
According to the 2013 budget, the Venezuelan government expects inflation to end the year between 14.0% and 16.0%. LatinFocus Consensus Forecast panellists expect consumer prices to rise 29.2% by the end of this year, which is up 0.4 percentage points from last month's forecast. Next year, the panel sees inflation at 27.0%.