Inflation ticks up in Paraguay, Uruguay

Inflation is climbing across Latin America amid the reopening of economies, including in some of the smaller countries such as Paraguay and Uruguay.

Monthly inflation in Paraguay was 0.9% in August, compared with 0.5% the same month a year earlier, according to central bank data. Last month’s print brought Paraguay’s annual reading to 5.6%, above the central bank’s target of 4% and higher than the 1.6% registered 12 months earlier.  

In Uruguay the August inflation print was 0.9%, taking annual inflation to 7.59%, up from 7.3% in July. This is above the bank’s target range of 3-7% but below the reading of 9.79% in August 2020, statistics agency Ine said.

Latin America was among the hardest hit by the pandemic but is experiencing an economic rebound this year, a factor – along with others such as the global rally of food and energy prices – behind climbing inflation.

The region’s largest economy, Brazil, faces inflationary pressure from rising electricity rates stemming from a historic drought that is impacting hydroelectric output. Inflation has also climbed in Chile and Peru.