The inflation in Uruguay it fell to 7.1% year-on-year in the month of May, an indicator that at the monthly level achieved a slight drop of 0.01%, reported the National Institute of Statistics (INE), a figure considered encouraging by the government, which maintains the inflation target in the 3-6% range.
The recoil of Consumer Price Index (CPI) in May it responded to a fall in the prices of the “Food and Non-Alcoholic Beverages” division, which fell by 0.54%, having an incidence of 0.15 in the General Index.
Lowering inflation is the central theme of the government’s economic policy, which led to the Central Bank of Uruguay (BCU) to maintain this year the contractive policy of interest rates. Although there was a drop in the rate in April to 11.25%, the pace is considered slow for some productive sectors that suffer the impact of the exchange rate delay in loss of competitiveness.
“The inflation data is good and we hope it will continue to drop,” said the president of the BCU, Diego Labatto scope.com during a conference on competition defense, organized by the Ministry of Economy and Finance (MEF).
Labat, who avoided referring to the price of the dollar and the farmer’s claims in this regard – an issue that he described as “delicate” – and insisted that “the priority is inflation”.
Market inflation expectations, rising
The expectations of the economic and financial agents that the Central Bank periodically consults to find out the market climate showed greater caution regarding inflation for the month of May.
The latest BCU Economic Expectations survey showed that they expected a median of 0.5% inflation for Maywith a minimum of 0.2 and a maximum of 0.7%.
The question of expectations was controversial last month when the Minister of Economy and Finance, lily arbelecheduring a lunch organized by the Association of Marketing Managers (ADM), He expressed his wish that businessmen’s expectations were lower, suggesting that it was a cause of the price increase. “What is expected is transferred to prices,” he said then.
Source: Ambito
