Uruguay: Inflation rises in February
Latest reading: Inflation inched up to 5.1% in February from January’s 5.0%. However, the print remained within the Central Bank’s 3.0–6.0% target range. Looking at the details of the release, housing and utility costs picked up pace, and textile prices fell at a softer clip in February. On the flip side, price pressures for food and transport softened.
As a result, the trend pointed up, with annual average inflation rising to 4.9% in February (January: 4.8%).
Lastly, consumer prices rose 0.69% in February over the previous month, a smaller increase than January’s 1.10% rise.
Panelist insight: Commenting on inflationary risks, EIU analysts said:
“There is a high risk that inflation will be higher than we expect, as the incoming government may raise minimum salaries and pensions as well as agree to wage increases—that are higher than we expect—in collective bargaining agreements. Other risks include higher energy prices, especially for oil, amid geopolitical tensions in the Middle East and Europe. Adverse climate conditions, such as a drought during a severe La Niña weather event, could also lead to a temporary rise in price pressures at some point in the forecast period.”