Inflation in Paraguay in June 2018 was 0.7%

Inflation for the month of June 2018, as measured by the change in the Consumer Price Index (CPI), was 0.7%, a rate above -0.2% observed in the same month of the previous year. . With this result, the cumulative inflation for the year rises to 1.9%, below the 2% verified in the same period of 2017.

The inflation of the year 39, one year on the other was 4.4%, higher at 3.5% recorded in May of the current year, and also higher than the rate of 2.9% recorded in the current year. June of last year. On the other hand, it is emphasized that the underlying inflation was lower than the monthly total inflation (0.5%). Thus, year-on-year inflation measured by this indicator reached a rate of 2.9%, higher than the 2.4% recorded in May of the current year, but lower than the rate of 3 , 2% verified during the month. June of the year 2017.

Main Aspects of Inflation

The change in consumer prices for the month of June 2018 was characterized by price increases recorded in food products, as well as verified increases in fuel prices, in sustainable goods and services.

In the food sector, cereal prices and their derivatives have risen, highlighting the rise in baked goods and wheat flour. The latter, according to industry agents, is the consequence of a decline in wheat production recorded the previous year. At the regional level, FAO reports show that the increase in wheat prices is largely due to a decline in production prospects in Argentina and Brazil, which could also affect the expectation of 39, a higher demand for cereals or flour

For their part, dairy products, including milk and cheese, saw their prices rise. In the opinion of industry representatives, this price behavior of dairy products is seasonal, due to an increase in domestic demand during this time of the year and coinciding with lower production. at the end of the summer period.

also observed a decline in beef prices, according to information from industry agents, responds to an increase in supply due to an increase in the level of slaughter. However, due to the period of low temperatures that generally affects the development and quality of pastures, a limitation of livestock supply is expected in the short term. In addition, price reductions have been observed for some beef substitutes, including pork.

Regarding petroleum products, they showed price increases, particularly those recorded in domestic gas, naphtha, and diesel, because of the rise in international oil prices. It is important to mention that in June 2018, the price of diesel ceases to be a price administered by the government, its quotation being determined by the free play of supply and demand.

increase in the price of intercity passage explained by the adjustment of the price of diesel.

In the services stand out the price increases of rental housing, painter service, medical care, laboratory services, hotel accommodation service, international road transport, insurance of vehicles , funeral services, among others.

Finally, durable goods of imported origin showed price increases mainly in motor vehicles and computer equipment

Download report

Source: BCP