Inflation in Chile rises 0.3% in February and 7.8% cumulatively in 12 months

RIO DE JANEIRO, BRAZIL – Inflation in Chile registered a monthly increase of 0.3% in February, due to a rise in food and non-alcoholic beverages, housing, and basic services, according to the National Statistics Institute (INE) on Tuesday.

The consumer price index (CPI) thus rose 1.5% year to date and 7.8% in the last twelve months, well above the tolerance range of 2% to 4% set by the Central Bank.

“Ten of the twelve departments that make up the CPI basket contributed positively to the monthly change in the index, while two were negative,” INE explained.

The departments with price increases included food and non-alcoholic beverages (1.8%) and housing and basic services (0.9%).

Leisure (5.2%) and culture (0.3%) recorded price decreases.

Compared to the previous month, bread (3.2%), beef (2.8%) and new motor vehicles (1.7%) increased the most.

Prices for package tours (24.3%) and air transport services (17.5%) fell the most, according to the agency.

Chile ended 2021 with an inflation rate of 7.2%, the highest level in 14 years.

The central bank decided in late January to raise its key interest rate by 150 points from 4% to 5.5%, the highest level since 2011 and the biggest change since the so-called nominal monetary policy rate (TPM) was established in 2001.

The country has been in a sustained recovery for several months, and the central bank estimates GDP growth of 11.5% to 12% through 2021.

With 3.2 million infections and more than 43,000 deaths, Chile experienced a strong wave of infection by the Omicron variant between January and March, although the country did not impose a quarantine.