Perhaps proving that concern exists, government officials this week made a number of press statements expressing confidence that inflation will come down and insisting that the current targets are not out of reach. Nevertheless independent analysts have been raising their estimates for annual inflation and beginning to register some concern. Below we look at what may be driving the current inflation and note some indicators to watch for the rest of the year. Again, tariff increases and seasonal factors were blamed. Some seasonal factors also may be involved in the increases in paid services.
Tariffs are one component of paid services and also show up in the prices of finished goods.
Tariff increases were widely blamed for the inflationary jump both at the end of last year and in January and February. However, it is worth noting that in February energy prices fell, holding inflation down. Without these reductions, February inflation would have been higher. Another factor influencing inflation may be higher demand and inflation expectations. The November CSI reported increased inflationary expectations and increased major purchases in expectation of future price increases.