Inflation is starting to ease in Chile. The Consumer Price Index (CPI) posted a monthly increase of 0.9% in September, according to the National Statistics Institute (INE).
The variation is in line with what was projected by the median of analysts consulted by Bloomberg.
It has increased 10.8% this year and records a variation of 13.7% over twelve months, which means the first decline in year-on-year inflation since February 2021.
It is worth noting that Chile reported year-on-year inflation of 14.1% in August, the highest since 1992.
In a statement published on Friday, October 7, the state agency said, “nine of the twelve divisions that make up the CPI basket contributed positive incidences in the monthly variation of the index, and three presented negative incidences”.
It also reported that among the divisions with increases in their prices, food and non-alcoholic beverages (2.3%), with 0.488 percentage points (pp.), and equipment and maintenance of the home (1.9%), with 0.117 pp.
“Among the divisions with decreases, transportation (-0.2%) stood out, with -0.027 pp.”
Economist Jorge Selaive explained that the monthly CPI for September was not surprising due to two items: tourist package/air transportation, with an incidence of -0.26%. “The price basket reaches a historically high spread (number of products rising in price) of almost 71%. The fight against inflation is still not won,” he said on Twitter.
“CPI September of 0.9% [is] not surprising thanks to two items (tourist package/air transport: inc -0.26%). The price basket reaches a historically high spread (number of products rising in price) of almost 71%. The fight against inflation is still not won,” Jorge Selaive wrote on his Twitter account.
The Central Bank of Chile is expected to raise its monetary policy rate again next week. Financial traders polled by the central bank are betting on a hike of 50 basis points, which would take rates to 11.25%.
Mario Marcel, Minister of Finance, yesterday highlighted the work of the Central Bank, the support of fiscal policy, in the face of internal price pressures on inflation. “That will help us in the coming months,” he said.
Chile cut by almost 24% public spending this year compared to 2021. In contrast, President Gabriel Boric announced a 4.2% increase in spending by 2023.
With information from Bloomberg