Caracas, Reuters—Venezuela’s annual inflation rate hit 45.4 percent in August, the central bank said on Tuesday, the highest for the OPEC nation in five years, even as consumer price increases slowed from the previous month.
President Nicolas Maduro’s government has vowed to rein in inflation this year, but officials have indicated that they will revise the year-end target of between 15 and 20 percent that was set last year.
Inflation slowed to 3.0 percent in August, from 3.2 percent in July, thanks to a decline in the cost of housing services, and a slower increase in the price of education and health services, the central bank said.
That helped offset an acceleration in the prices of home appliances and entertainment services.
The annualized rate is Venezuela’s highest since 2008, when the government of Maduro’s late mentor Hugo Chavez implemented a new methodology for measuring price increases.
The country’s nagging product shortages, which have affected goods ranging from newsprint to toilet paper, worsened slightly in August from the previous month. The bank’s “shortage index” rose to 20 percent from 19.4 percent.
Venezuela’s monetary liquidity, the primary measurement of its money supply, has expanded by almost 40 percent during the last year – leaving a greater volume of the local bolivar currency chasing the same number of goods and services.
Heavy state spending in 2012, which helped Chavez win re-election, then a devaluation of the bolivar in February, have also worsened inflation.
Government leaders blame inflation on unscrupulous merchants arbitrarily raising prices of staple goods and basic services.
They also say that its impact has, in part, been offset by Chavez-era social programs including subsidized groceries and expanded health care services that have given extra help to the country’s poor.