Inflation accelerated slightly in January and stood at 8.15% in the index accumulated in the last 12 months, almost two tenths above the 7.96% in December.
According to data released this Thursday by the National Institute of Statistics (INE), andl Consumer Price Index (CPI) grew 1.78% in January, above the 1.6% recorded in the same month last year.
The main incidences in the monthly variation of the CPI come from the following divisions: food and non-alcoholic beverages (0.36%), alcoholic beverages, tobacco and narcotics (0.17%), housing (0.88%) and health ( 0.21%), according to the INE.
Among the prices that increased the most in the month were lettuce (19.3%), zucchini (33.4%), tomato (16.3%) and lemons (22.5%).
The The data for the first month of the year was somewhat higher than the projection of 1.69% given by the median number of responses to the BCU’s Survey of Expectations. Analysts currently expect prices to close the year with a 7% rise, while the Ministry of Economy and Finance (MEF) projects inflation of 5.8% in 2022.
In this way, inflation remains above the ceiling of the target range set by the authorities of between 3% and 7%.
At the last meeting of Monetary Policy Committee (Copom) of the BCU last month, the authorities decided to raise the monetary policy rate for the fourth consecutive time. The rate increased 75 basis points, from 5.75% to 6.5%, due to the fact that the Committee considered it convenient to “accentuate the efforts to reach the inflationary objectives”. In addition, the official statement announced that the members foresee “increases of a similar magnitude in the next two sessions of the Committee, which will imply reaching a neutral interest rate at the beginning of the second quarter of 2022″.
The authorities are betting on bringing expectations to the center of the 24-month target range (4.5%), which will have a ceiling of 6% instead of 7% from September this year. According to the BCU’s Inflation Expectations Survey, private agents currently expect 6.6% inflation in two years —beyond the target set— and businessmen, more pessimistic, believe that the figure will be placed at 8% according to the monthly survey of the INE.
In line with expectations, in January the #inflation Annual growth accelerates to 8.2% (+0.2%) and the trend to 8.5% (+0.5%)
The tradable component has an upward impact on the acceleration of the annual data (from 10.2% in Dec. to 10.7% in Jan.) while the administered component falls from 9.2% to 8.9% pic.twitter.com/Dm3Tbo0Y3g
— Nicholas Cichevski (@ncichevski) February 3, 2022
