Inflation would continue to rise in January and would touch the figure of 13.4%

The first month of 2023 started with new price pressures, derived from situations such as the rise that persists in food and fuel prices, the indexing of different tariffs to inflation and the increase in the minimum wage. For this reason theAnalysts expect the inflation figure that the Dane will announce this Saturday show a new escalation.

(See: For the Fed, the US rate hike is not over yet).

In fact, according to Monthly survey of expectations of economic analysts carried out by Banco de la República, The market expects that during the first month of the year the price indicator for the basic basket of Colombians will has increased an average of 1.61%.

In relation to the annual variation that the consumer price index (CPI) would reach, analysts consider that inflation will be located at 13.36% (in a range between 13.03% and 13.66%), according to the latest Financial Opinion Survey that includes Fedesarrollo.

“For the first month of the year, we are expecting inflation of 1.83% in Itaú, which is significantly higher than what we observed a year ago, of 1.67%.”, indicated Carolina Monzón, manager of Economic Research for Itaú, who indicates that there will be a new acceleration in prices and the annual figure would reach 13.3%.

(See: Economic recession or stability in Colombia? This is what analysts say).

According to the economist, the upward pressures will be seen in different areas, and transportation was especially highlighted, not only due to the increase in the price of gasoline, but also due to the increase in the prices of air tickets as a cause of the changes in VAT and due to the adjustment that has been made in the prices of public transport in several cities.

In turn, according to Monzón, inflationary pressures are also expected on the side of restaurants and hotels, which have been collecting higher prices for food, as well as the entry into force again of the consumption tax and VAT. Although he said that the CPI for food would continue with upward pressures, it is estimated that they will be much more moderate than planned.

(See: Banco de la República forecasts high inflation for this year).

A similar calculation has it BTG Pactual, which projects a monthly inflation in January of 1.82% to thus arrive at an annual figure of 13.3%, while the brokerage house Casa de Bolsa speaks of a 1.9% increase in prices compared to December and annual inflation of 13.4%.

Juan David Ballén, Director of Analysis and Strategy at Casa de Bolsa, He highlighted that January may show especially high signs in relation to food prices due to the closures on the Pan-American Highway, but he emphasized that the increases will come more from other factors.

“On the one hand, we have assets indexed to the minimum wage and inflation at the end of last year, we have a significant rent shock, and food outside the home, which is usually correlated with the increase in the minimum wage.”, he assured.

(See: Is economic recession approaching?: this says the Bank of the Republic).

You have a higher expectation Bolívar-Davivienda Group with a forecast of 2.16% and 13.68% for monthly and annual inflation in January, respectively.

“During the month, factors linked to the rise in the minimum wage stood out, which will affect groups such as eating out; We also have an effect on air tickets due to the increase in VAT and we see an increase in the consumption tax, which the establishments under the simple regime were not charging. In addition, we have the increase in leases, which is linked to last year’s inflation, and we have seen an upward behavior in some perishables, due to the closure of the Popayán – Pasto highway”, indicated Andrés Langebeak, director of Economic Studies Grupo Bolívar.

(See: Banrep’s recent decision, does it imply moderation of the increases?).

From elsewhere, Bank of Bogota estimates an even greater increase in prices in January, which would be reflected in a variation of 2.2%, with which the annual data would reach up to 13.7%.