Venezuela’s Monthly Inflation and Unemployment Rates Drop
Mérida, March 6th 2009 (Venezuelanalysis.com) — Monthly inflation in Venezuela dropped to 1.3% in February from 2.3% in January, an indication that last year’s high rate of monthly inflation may be coming under control. Also, the unemployment rate in January was 9.5%, a decrease from what it was at the beginning of 2008 but represents a typical seasonal increase since December.
Food prices, after inflating by more than 35% over the course of the world food crisis last year, did not increase in the month of February. Rents rose by just 0.4%, health care costs rose by 2.8%, and transportation costs rose by 2.2%, according to the National Institute of Statistics (INE).
The deceleration of inflation occurred in all ten of Venezuela’s principal cities. February’s inflation rate was the lowest registered since January of 2008, when the INE expanded the number of prices, establishments, and cities taken into account in its inflation measurement.
February’s inflation rate brings the total inflation over the past twelve months to 25.6%. Inflation peaked last May at 3.2% for that month.
January’s unemployment rate of 9.5% showed improvement compared to the 10.2% unemployment in January 2008. It is also significantly lower than the 16.6% unemployment in January of 1999, the year President Hugo Chávez took office, and it is a sharp drop from the peak of 19.1% unemployment following the management-led oil industry shutdown, an intentional sabotage of the economy, that ended in early 2003.
However, January’s unemployment rate is an increase from the 6.1% unemployment in December of 2008, which is typical for Venezuela’s seasonal fluctuations in its unemployment rate, which tends to jump significantly between December and January every year. Last year, unemployment averaged 7.4%.
Venezuela has set a goal of 15% inflation for 2009, and plans to maintain its social programs, stimulus to small and medium sized enterprises, and investments in infrastructure and the agricultural sector, in order to increase employment.