Peru Inflation December 2015

Peru

Peru: Inflation jumps further above target in December

January 4, 2016

Consumer prices for Metropolitan Lima increased 0.45% in December over the previous month, which was above the 0.34% rise registered in November. This was also stronger than the 0.26% increase expected by market analysts.

Inflation increased from 4.2% in November to end the year at 4.4% in December (2014: 3.2%). Consequently, inflation moved further above the upper limit of the Central Bank’s target of 2.0% plus/minus 1.0 percentage points. The annual rise was driven largely by higher prices for rental housing, fuel and electricity, as well as food and beverages. The weak Peruvian sol is also contributing to inflationary pressures.

In its December quarterly inflation report, the Central Bank indicated that it expects inflation to be between 2.5% and 3.0% in 2016 and between 2.0%-2.5% in 2017. Panelists participating in the LatinFocus Consensus Forecast expect inflation to end 2016 at 3.2%, which is unchanged from last month’s projection. For 2017, the panel expects inflation of 2.8%.


Author:, Economist

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Peru Inflation December 2015

Note: Month-on-month and year-on-year variation of consumer price index in %.
Source: Peru National Statistical Institute (INEI)


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