Inflation in Peru's capital unexpectedly accelerated for the seventh consecutive month in June, hitting an annual rate of 4.14%. This figure surpassed May's 4.01% reading, according to data released by the national statistics agency INEI on Monday. The result also exceeded the 3.90% median estimate from economists surveyed by Bloomberg, marking the highest annual print since September 2023's 4.29% reading.
The primary driver of this acceleration was a significant increase in food prices. Chicken prices, which had seen a decline in previous months, rose by 5.3% in June. Additionally, vegetable prices surged by 3.8%, contributing substantially to the overall inflation. The cost of dining out also played a role, increasing by 0.7% during the month.
Despite the recent acceleration, inflation in Lima had seen a brief period of moderation in May, coming in below expectations. However, it still remained above the central bank’s target range for the third straight month. The central bank's inflation target is typically within a band of 1% to 3%.
Economists and analysts noted that the persistent rise in inflation, especially in core components like food, indicates ongoing price pressures within the Peruvian economy. This trend has been observed since March, when inflation first topped the central bank's target after two years, driven by factors such as a domestic gas crisis, higher global oil prices, and adverse weather conditions. The continued upward trajectory challenges the central bank's efforts to bring inflation back within its desired range, with some forecasts predicting an end-of-year inflation rate around 2.6% but with an upward bias.
