Inflation in Venezuela reached 10.6% in August – OVF

RIO DE JANEIRO, BRAZIL – Monthly inflation in Venezuela stood at 10.6% in August, according to the Venezuelan Finance Observatory (OVF), an independent entity comprising several economic analysts.

On Twitter, OVF said that the 12-months inflation stood at 1,743%, while accumulated inflation so far this year reached 470.3%.

On the other hand, the observatory reported that the basic food basket “reached the cost of US$305.09.”

The items that increased the most during August were leisure (35%), services (24%) and food and beverages (9.7%).

Inflation last July stood at 19%, a spike after reaching 6% in June, its lowest since January 2017, according to OVF data. In May, it reached 19.6%, while in April it closed at 33.4% and in March at 9.1%, OVF said.

When presenting the data, economist and OVF member José Guerra denounced that the Central Bank of Venezuela (BCV) “is still in arrears with (the publication of) inflation figures.”

He also considered that “the patient is still ill,” meaning that hyperinflation in Venezuela persists, as well as “the destruction of the bolivar” – the national currency which has been replaced by the dollar – and of the purchasing power of salaries.

Among the causes that have led to the deceleration of inflation, Guerra explained that “the BCV has been restricting monetary liquidity.”

On the other hand, he also said that inflation is related to “the lower depreciation of the bolivar in August,” which devaluated by 2.7%. Despite this decrease in the devaluation of the national currency, he explained that “domestic inflation is much higher.”

Due to the devaluation of the bolivar, there has been a process of transactions dollarization in the economy, whereby most purchases are made in the U.S. currency.