Expert Predicts Dominican Republic’s Inflation Will Reach 13%

 

•  The Dominican Republic Consumer Price Index (CPI) in 2021 reached its highest level since 2008, at 8.50%, and everything seems to indicate that this year it will surpass double digits. 
• Inflation is expected to range between 12% and 13% by the end of 2022 assuming that the conflict between Russia and Ukraine will continue for at least four months, which will undoubtedly alter the macroeconomic framework of the country. 
• Antonio Ciriaco Cruz, an Economist, explained that the government must make a supplementary budget because, in the current one, the oil barrel is contemplated at US$62. 
• In this sense, he explained that if, in the best-case scenario, the average price of oil is at US$90, the oil bill would increase by some US$2.4Bn in addition to the US$4Bn paid last year. The bill could reach US$7 billion he noted. This is a difficult situation for countries like the Dominican Republic, which is a net importer of oil. 
• The current Russia-Ukraine crisis is likely to push oil and natural gas prices higher and drive up import costs for key commodities such as wheat and corn, thereby contributing to higher levels of inflation. The expected rise in inflation for the Dominican Republic will have implications for consumers, businesses and the overall economy.

 (Source: Dominican Today)