The Banco Central de Venezuela issued a correction today for the inflation numbers it released yesterday.
Yesterday, the bank released data concluding that the annualized inflation rate for June of 2014 was 62.2%. According to today’s correction, that number is actually 60.5%.
According to Jose Guerra, the ex-manager of economic investigation at the Banco Central de Venezuela, the inconsistency is due to the bank forgetting to double-check its numbers after a change in methodology. Guerra said:
If the inflation rate between June of 2013 and June of 2014 was 62.2% [as was stated yesterday], then June’s inflation could not have been 4.4% [was was stated yesterday], but 5.5%.
Weight was removed from the calculations to determine inflation for food, which is what has increased in price the most. They shifted the weights without telling the country and without showing studies to justify that change. Thanks to the new weighting, June’s inflation – now – is 4.4%, for July it was 4.1%, and for August it was 3.9%.
In other words, Guerra argues that the bank attempted to soften the numbers – using a different method to calculate the figures which would yield a numerically lower result – but it forgot to account for this in the final version of the report released yesterday.
Food Prices Rise 98% in 12 Months
The inflation numbers – both sets of them – spell trouble for the average Venezuelan. The Centro de Documentacion y Analisis Social de la Federacion Medica Venezolana (CENDAS) said the average price for a basket full of essential food has risen 98% in the last year.
On average, it costs Venezuelans Bs, 13,482.56 to purchase an average food basket containing staples such as powdered milk, chicken, sugar, cooking oil, and corn flour. A Venezuelan would need to work 3.2 minimum wage jobs to cover the expense.
CENDAS also calculated that the average lunch in Venezuela costs Bs. 276.42, which equals around $43 at the official government rate.
Capriles Criticises Government on Inflation Figures
Governor of Miranda Henrique Capriles appeared at an event in his home state today, where he spoke on the inflation numbers released yesterday and revised today by the government. Capriles said;
The [economic] model headed by the national government destroyed national production and has resulted in the fact that we have the highest inflation rate on the planet, even though we have an abundance of oil. They want to put make up on the facts, but they cannot hide them.
Capriles also spoke on his own personal vision for Venezuela, saying:
We [the opposition] are interested in getting Venezuelans out of poverty. That’s the path we must all start to build. We must prepare for the change that is coming… no one must be left out. A united people cannot be stopped. This must be the struggle to defeat the failed and corrupt model embodied by the current government.
Lopez Trial Continues
The trial of Leopoldo Lopez continued in Caracas today, where the prosecution called four more witnesses to the stand to testify against Lopez and four students. The defendants are implicated in a string of crimes stemming from the February 12 protests, including arson.
One of Lopez’s lawyers, Juan Carlos Gutierrez, was optimistic that the government’s case would fall apart, saying:
Today, the expectations is that the witnesses will speak the truth, and that they will speak on the discovery of certain evidence. If that’s the case, it will be demonstrated that the attorney general’s was never burned. That crime never happened, never took place.
Leopoldo’s father, Leopoldo Lopez Gil, said that a request by his soon to see a doctor had been denied. Gil said:
[Leopoldo] has a problem from not seeing natural light due to the fact that he’s been held in Ramo Verde [prison] under isolation for the past 204 days.