As Luis Salas was announcing his Economic Emergency Decree, the Central Bank of Venezuela posted inflation, GDP and Balance of Payments data through QIII 2015.
Anywhere else in the world, this report would be routine. In Venezuela, where such data hadn’t been published in over a year, the data dump is anything but.
Salas’s decree – a mixture of vagueness and more-of-the-same – looks to me like an elaborate misdirection stunt to draw attention away from the carnage reported in the BCV Communiqué.
[Some people are having trouble with the link above. We have, of course, saved our own copy of the report, which you can see here.]
Inflation in the first nine months of the year was 109%, for an annualized rate of 141%. That’s the highest annualized inflation rate in Venezuela since records began to be kept.
It’s the first official inflation report published in over a year.
In the third quarter of last year alone, the food prices rose 55.7%.
The communiqué cites “lineal econometrics studies” to blame DolarToday.com for 60% of the rise in prices!
In QIII last year, GDP contracted 7.1% year-on-year, the 7th straight quarter in recession. The sector data is grim, with five major sector showing year-on-year falls of more than 10%:
- Construction: -20.2% (!!!!)
- Financial institutions: -14.4%
- Commerce : -12.8%
- Manufacturing: -11.1%
- Transport and storage: -10.7%
Only Telecoms and Government Services grew (2.2% and 1%, respectively.)
No data was published for QIV 2015.
Balance of Payments
The Current Account in the 3rd quarter alone showed a deficit of $5.05 billion, including a $782 million trade deficit…at a time when Venezuela’s average oil export price was a comparatively healthy $44.65/barrel. (In 2016 so far that average is $25.93/barrel.)
To an economist, it all reads like an autopsy report, laced with excuses and an obsessive concern with blame-shifting.
Perhaps the most sobering part is that at the end of announcing these shocking figures, BCV concludes, incongruously, saying that “all the conditions are now in place for this productive model to generate social well-being for the Venezuelan population”!!!
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