Ecuador’s October Prices Rise at Slowest Pace Since May
Consumer prices in Ecuador rose last month at their slowest pace since May as households limited spending to boost savings ahead of December holidays.
Prices in the Andean country climbed 0.1 percent in October from a month earlier, while annual inflation fell to 4.94 percent from 5.22 percent the month before, the National Statistics and Census Institute said today in a report on its website.
Families cut back on expenses last month in anticipation of higher outlays in December during the Christmas holiday and a week-long celebration in Quito, said Maria Herrera, an economics professor at the Universidad Catolica in Quito. Inflation in December will probably quicken to levels above the average of the last three months, she said.
“Normally people are reserving themselves for Christmas when there is a bit more spending and excess of funds,” Herrera, who forecast prices will increase an average 5 percent in 2012, said by phone from Quito. “In December you’re going to see prices rise much more.”
Price increases, led by alcohol and tobacco, were offset by declines in goods and services, recreation, food and household articles, the statistics agency said.
Prices rose the fastest in the highland Andean city of Ambato, jumping 1.6 percent in October from the previous month, while costs fell 0.18 percent in the nation’s largest city, Guayaquil, the agency said. Ecuador, the smallest member of the Organization of Petroleum Exporting Countries, subsidizes fuel costs and the domestic use of natural gas.
Producer prices fell 0.05 percent from the previous month and increased 2.83 percent from October 2011.
Consumer prices are forecast to gain an average 5.14 percent this year compared with 4.47 percent in 2011, according to the Finance Ministry’s 2012 budget. The economy may expand 4.8 percent this year, the central bank said in July, less than the 5.35 percent originally estimated in the 2012 budget.