MercoPress. South Atlantic News Agency

May marks highest monthly inflation in Chile since 1994

Chile's Consumer Price Index soared 1.2% in May, far above forecasts (0.6%), and the highest since May 1994 (1.4%) and also the most significant monthly variation since March 2003, according to the country's Statistics Office.

In five months Chile's consumer inflation accumulates 2.8% and 8.9% in the last twelve months. "We're not satisfied", said Finance minister Andres Velasco, who blamed mainly transport and food for the "pinch in people's pockets". In effect, Food jumped 1.9% in May; Transport 2.7% and Others, 2.9% and overall seven of the eight groups which make up the CPI increased. The index which excludes volatile food and energy prices also increased but 0.7% in May, and 8.4% in the last twelve months. However in spite of the budding inflation, the Chilean economy fared much better than expected, 4.8% as opposed to forecasts of 3.6%. "The good news is that the economy expanded at 4.8% in spite of the energy problems and gas shortages, which is clearly indicating we can keep growing, investing and particularly creating jobs", said minister Velasco. "Manufacturing is recovering capital goods imports are increasing which are positive signals and evidence of confidence" added Velasco.