Cumulative inflation crosses all limits in almost 30 years and rising food prices continue to exert pressure

Rising food prices continue to be one of the main factors driving up the cost of living. Year-to-date cumulative inflation is already in double digits for the second consecutive month.

The National Institute of Statistics (INE) reported on Wednesday that in May the The Consumer Price Index (CPI) recorded a monthly increase of 1.2%, a cumulative change of 6.1% so far this year and a year-over-year increase of 11.5%.

Previously, in April, the cost of living in Chile showed a year-over-year increase of 10.5%. Until then, it was the first double-digit record in almost 30 years, since when in 1994 the cumulative rate was 11.2%.

According to the INE, in May ten of the twelve divisions that make up the CPI basket contributed positively to the monthly variation of the index and two had a negative impact.

“Among the divisions whose prices are rising, food and non-alcoholic beverages (1.8%); and transportation (2.2%)”he underlined.

In food, the most significant increases concern the segments bread and cereals (1.6%), as well as vegetables, legumes and tubers (2.5%).

In some products, the increase in the price of soft drink (4.8%)followed by bread (1.6%).

Among the divisions with a negative impact, communication stands out (-0.3%).

products

– Air transport service: In May, it showed a monthly increase of 21.3%, contributing 0.200pp. to the variation of the general indicator. It accumulates 26.2% in the fifth month of the year and 103.9% in twelve months.

-Organized trip: It registered a monthly increase of 6.9%, with an impact of 0.089 pp., and variations of -8.9% so far this year and 66.3% in twelve months.

-Food consumed outside the home: It recorded a monthly rise of 2.3%, with 0.073 pp., accumulating 7.3% so far this year and 16.6% year-on-year.

-Gasoline: It recorded a rise of 1.9%, with 0.058 pp., cumulating 12.3% so far in 2022 and 28.9% year-on-year.

-Lemon: It registered a monthly decline of 12.5%, with an impact of -0.022 pp, recording a change of 67.8% so far this year and 6.3% year-over-year.

-Intercity bus transportation service: It recorded a monthly decline of 2.0%, with -0.012pp, accumulating -4.5% so far in 2022 and 41.0% year-over-year.

Interest rate

Given the inflationary scenario, over the past few hours the Central Bank Board has agreed increase the monetary policy rate by 75 basis points, leaving it at 9%.

From the organization, it was clarified that the decision was due to the effects of global inflation since its outlook has steadily increased. The above, realizing more general price increases.

This is the highest level since the end of the 1990s, more precisely in November 1998 when it also exceeded 9%.

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