According to the Administrative Department of Statistics (DANE), the Consumer Price Index (CPI) in Colombia stood at 10.99% in September. Experts had predicted a figure below 11%, and, although only by a tenth, it has been confirmed to be so. This represents a reduction of 0.44% compared to August.
With this data, September completes the sixth consecutive month of decreases. Although the figure remains high, if the trend continues, the government’s objective of having the annual CPI below 10% by December would be achieved.
Piedad Urdinola, director of DANE, announced this: “We had an inflation rate of 0.54%, which is a variation from the same month last year. The year-to-date variation is still in single digits at 8.01%, below the 10.08% reported last year, and the annual variation is 10.99%, more than one point lower than what we were reporting last year at 11.44%,” she explained.
So far this year, the 2023 CPI (January-September) stands at 8.01%, representing a 2.07% reduction compared to the same period in 2022.
Education and transportation, the most inflationary categories
According to DANE’s information, the most inflationary category in September was Education, which increased by 1.79%. The reason is the start of the school year in September for students following the B school calendar (September to June). Next, some way behind were Food and Non-Alcoholic Beverages, which rose by 0.74%; Direct Goods and Services, 0.68%; and Transportation, 0.67%.
In the case of food, although it is not the most inflationary category, it has a significant impact on households’ domestic economies. For example, there has been a spectacular increase in the price of tomatoes, which has risen by nearly 40% in the last month.
It is worth noting that the Transportation category is greatly affected by the scheduled increases in gasoline prices. Diesel, which will not start to rise in price until February of next year, does not currently impact inflation.
This is reflected in the annual variation by divisions: Transportation is the category with the highest increase (18.56%), followed by Restaurants and Hotels (15.32%), Alcoholic Beverages and Tobacco (13.33%), Direct Goods and Services (12.05%), and, most significantly for Colombian family budgets, Food and Non-Alcoholic Beverages (11.47%).
Geographically, the cities with the highest inflation rates are Sincelejo, in the Sucre department (12.36%), and Cúcuta, in Norte de Santander (12.23%). They are followed by cities such as Montería (11.81%), Valledupar (11.30%), and Bogotá (11.29%).
The capital cities with the lowest CPI are Villavicencio (9.39%), Riohacha (9.92%), Santa Marta (10.09%), and Manizales (10.29%).
The government responded through Finance Minister Ricardo Bonilla. He celebrated that “for the sixth consecutive month, inflation has been declining.” In this regard, the minister expects that with three months to go, inflation will end up in December at a single-digit rate, most likely around 9.5%, which means that their objectives are being met.
Bonilla pointed out that the only category affecting the growth trend is “fuels, the increase in gasoline prices, which we will have to continue adjusting.” He also sent a message to the board of the Central Bank of Colombia to lower the interest rate in its next meeting at the end of October. In its meeting a week ago, the central bank left the rate unchanged at 13.25%, where it had been fixed since May.