Annual inflation drops to 7.97% in Lima, but it would reach the target range next year

In April, the consumer price index (CPI) in metropolitan Lima rose 0.56%, thus achieving 12-month cumulative inflation of 7.97%, being the lowest annual rate not seen in a year, according to the INEI.

Although this indicator is lower than the annual rate of 8.4% registered in March, there are still 23 consecutive months in which inflation is above the target range, which is set between 1% and 3%.

Likewise, inflation in April was above its usual average of previous years, when it registered figures below 0.2%, explains Juan Carlos Odareconomist and director of Phase Consultores, who adds that the latest figures are not low, but are being compared with rates for 2022, which were high.

Thus, with the April data, inflation for the first four months of the year stands at 2.35%, the second highest so far this century.

“The highest was last year and now we have inflation which is slightly higher than the first four months of 2008,” adds Odar to La República.

Due to these first results, the director of Phase Consultants considers that it is unlikely that at the end of this year inflation can return to the target range that the Central Reserve Bank of Peru (BCRP) foresees.

“It is more likely that the target range will be reached next year. To reach this year, we would have to accumulate a maximum of 0.65 points of inflation in the following eight months, considering that July and December have relatively high rates,” he emphasizes.

According to the survey of BCRP, the inflation expectation for 2023 is located in a range of 4.30% to 5.70%, that is, above the target range. While for 2024, economic agents expect it to fluctuate between 3.00% and 4.00%.

Products that went up and down the most

Food and non-alcoholic beverages rose 1.44% in April. In detail, chicken eggs had the highest prices with an increase of 5.6%, as well as strawberries that had an increase of 25.53%. The eviscerated chicken and the restaurant menu had a variation of 1.45% and 0.71%, respectively.

In contrast, a decrease was observed in green peas (-32.43%), lemons (-17.91%), white potatoes (-5.86%), electricity rates (-0.74%) and new cars. (-0.83%). Likewise, the liquefied gas of vehicle oil It had a fall in its price of 3.12% and diesel oil a decrease of 4.06%.

Trujillo and Ica with high rates

Annual inflation at the national level is 8.04%. By cities, Trujillo (10.46%) and Ica (10.05%) are the ones with the highest rates.

While Huancavelica (5.74%) and Moyobamba (5.44%) register the CPI lowest in Peru.

Meanwhile, Arequipa (9.43%), Tacna (9.18%), Cajamarca (8.91%), Huaraz (8.62%) and Puno (8.06%) They have a higher rate than the national.

Declining annualized inflation