Venezuela May inflation tops 60 pct, gov't blames protests

| Jun. 13, 2014 | Caracas, Venezuela

Published by Reuters

Brian Ellsworth and Girish Gupta

Venezuela's annualized inflation hit 60.9 percent in May while the monthly figure was 5.7 percent, the central bank said on Thursday, reaching a six-year high as President Nicolas Maduro struggles to control runaway prices.

The bank simultaneously released April's inflation figure - also 5.7 percent - which came a month after the legal deadline for its release, a delay critics say is meant to gloss over negative economic figures.

The statement attributed the price spike in both months to violent opposition protests by demonstrators seeking to force Maduro's resignation. Those protests often blocked roads, forced commerce to close early and prevented delivery of merchandise.

"These disturbances ... had a negative result on the Consumer Price Index by pressuring the availability of goods in public and private establishments," the bank said.

The protests, which have almost entirely died out, began in February but had waned considerably by the middle of last month.

May's inflation was driven by transport with a 10.1 percent increase, followed by a 6.9 percent jump in restaurant and hotel costs and a 6.4 percent rise in food and beverage costs.

It is the highest annualized figure since the government revamped its methodology for measuring consumer prices in 2008.

The data was published just over an hour after the end of the opening game of the World Cup in Brazil.

Opposition leaders have for months said that the figures were delayed for political gain. Rising prices were a primary motivation of the wave of protests, which killed dozens.

Maduro says the inflation spiral is the result of an "economic war" led by businesses and opposition leaders in cooperation with Washington in an effort to oust him from power.

His critics pin the problem on the torrid expansion of the money supply that vastly outstrips economy growth along with a shortage of dollars that has left many firms unable to import raw materials or machine parts.

Monetary liquidity grew close to 70 percent in 2013 despite economic growth of just 1.6 percent, and the money supply has doubled since November 2012. The bank has not released the first-quarter GDP figures, which are generally released by May.

(Editing by Bernard Orr)