The year-on-year inflationmeasured by the consumer price index (CPI) for the last twelve months, fell from 3.54% in July to 3.42 % in August 2024, remaining between the lower limit and the center of the target range of 4.0% ± 1.0% of the Central Bank of the Dominican Republic (BCRD) for the ninth consecutive month since December 2023.
However, the monthly variables show a marked impact on the line education and recreation and culturewhose articles and services increased 2.10% and 3.73%, respectively, the monetary entity detailed in its monthly report on the state of the inflation.
According to the report, the recreation and culture group is explained by the increases in cultural and recreation services, particularly in the games of chance (lottery)tour packages, gym memberships and school books.
While in education the elements of greatest variation were private school feescharacteristic behavior of school enrollment that occurs seasonally during this period, specifically in primary, secondary and preschool education services.
Additionally, increases were observed in services university educationOther components of school spending that showed positive variations during the month of August were books and school uniforms.
Regarding the analysis of the CPI for August with July 2024, the institution indicates that the food and non-alcoholic beverages group experienced a variation of 0.42%, lower than the increase of 1.42% observed in the month of July. articles of greatest impact in this group were:
– Fresh chicken
– Green and ripe bananas
– Bananas
– Rice
“It should be noted that the case of the fresh chickenthe food with the highest weighting in the basic basket, is mainly explained by the effect of the high temperatures recorded at this time of year, which reduce the productivity of this item. On the other hand, avocados, onions, oranges, chili peppers and eggs experienced price decreases,” says the report.
As for the inflation of various goods and services, the BCRD indicates that it was located at 0.35% due to the rise in prices in services of personal careMeanwhile, the restaurants and hotels sector showed a variation rate of 0.38% as a result of increases in the prices of meals prepared outside the home, mainly in the services of daily specials, chicken services and groceries with accompaniments.
“It should be noted that the increase in the price index for food supply services is due to the increase in basic inputs necessary for their production, which has a direct impact on the final price paid by the consumer for these services,” says the monetary authority.
The variables with the lowest incidence in the inflation
To a lesser extent, the group had an impact on the variation of the month transport with a rate of 0.16%explained by the increases in the prices of cars and taxi services. It should be noted that the measures implemented by the Executive Branch by establishing the subsidy for domestic fuels have mitigated the impact of this group on the variation of the general CPI, according to the BCRD.
- As for the health segment verified an increase in the inflation of 0.38% due to the increases in antihypertensives.
He Central Bank reported that the consumer price index recorded a monthly variation of 0.40% in August of this year 2024, lower than the rate of 0.53% observed in July.
The BCRD establishes that this result is explained, to a greater extent, by the slowdown in the pace of growth of food prices.
The BCRD points out that, with this behavior of an interannual inflation of 3.42% in August 2024, the Dominican Republic would be among the countries with the lowest inflation in Latin America, excluding dollarized economies such as Panama, Ecuador and El Salvador.
Inflation underlying
The monetary policy governing body indicates that with regard to the underlying inflation of the last twelve months, it stood at 4.05% at the end of August 2024. In this way, the inflation underlying remains around the center of the objective set by the institution.
“This indicator allows clearer signals to be extracted for driving the monetary policy“because it excludes some items that normally do not respond to liquidity conditions in the economy, such as food with great variability in its prices, fuels and services with regulated prices such as electricity rates, transportation, as well as alcoholic beverages and tobacco,” the report highlights.
Inflation of tradable and non-tradable goods
The CPI of the tradable goods The index of non-tradable goods and services experienced a variation of 0.18% in August 2024, due to the increase in prices observed in some food items, automobiles, antihypertensives and tourist packages. Regarding the monthly variation of the index of non-tradable goods and services, it stood at 0.63%.
Inflation by geographic area
The BCRD explains that the inflation by geographical regions in the month of August compared to July 2024 shows that the price index of the Ozama regionwhich includes the National District and the province of Santo Domingo, grew by 0.35%, the East region by 0.33% and the South region by 0.37%. As for the North region, it registered a inflation of 0.52%, derived from the higher incidence of the groups food and non-alcoholic beverages, recreation and culture, and various goods and services.
Inflation by quintiles
The monetary entity’s report indicates that the results of the Price indices by socioeconomic strata reflected variation rates of 0.31% for quintile 1 and 0.37% in quintiles 2 and 3.
In relation to the highest income quintilesquintiles 4 and 5, these presented variations of 0.39% and 0.36%, respectively. The lowest rate observed in quintile 1 is essentially explained by the lower relative incidence observed in the groups of Miscellaneous Goods and Services, Education and Transportation.
