Venezuelan Central Bank Releases Inflation Data after Year-Long Gap

Santa Elena, January 19th, 2016. (venezuelanalysis.com)- The Venezuelan Central Bank (BCV) has released data relating to the country’s debt and accumulated inflation rates after keeping the numbers under wraps since December 2014, on the grounds that the country is at war.

The report, published on Friday, began with an explanation of an ongoing economic war waged by promoters and participants of Venezuela’s dollar-dependent black market, such as phony importers and resellers of regulated goods.

It also included charts illustrating the decades-low drop in oil prices which has cut the country’s foreign income by more than half since late 2014.

“Despite these distortions,” the document reads, “social indicators such as unemployment, minimum wage, access to [social] missions and human development, among other things, manifests the favorable effects of the government’s actions for the majority of Venezuelans.”

According to the institution, the accumulated rate for inflation between September 2014 and 2015 reached a national average of 141 percent, with the cost of food seeing the most dramatic increase, at 254.3 percent. 

By region, major cities Caracas and Maracaibo saw the least inflation, at 99.6 and 95.7 percent respectively since January, while small cities and rural outposts saw the most damage.

The bank also made note of the account deficit in the third quarter of 2015, which totaled US$5.05 billion. $2.6 Billion dollars of the public external debt was paid off in the same time, leaving the country with US$16.27 billion in net foreign reserves.

Additionally, the country’s gross domestic product contracted by 7.1 percent from September 2014 to 2015, with construction and commerce some of the hardest hit areas at -20.2 percent and -12.8 percent negative growth, respectively. 

Public services and communications were the only areas of the ailing economy that rallied, with 1 percent and 2.2 percent growth respectively.

No data was provided for the final quarter of 2015.

The document concluded with a warning, saying Venezuela’s only chance for recovery will be by diversifying the economy and breaking the “hundred year rentier petroleum model.” 

The government yesterday unveiled a bid to grant the president enabling powers to pass a series of “measures for a productive economy,” but the bill will unlikely receive approval from the opposition majority in the newly sworn-in National Assembly.