Original article: El 4,5% que sacude a La Moneda: inflación repunta y alzas en bencinas y alimentos golpean el bolsillo

Inflation Hits 4.5% in Chile: Rising Fuel and Food Prices Strain Household Budgets

The Consumer Price Index (CPI) recorded a 0.5% increase in October, as reported by the National Statistical Institute (INE) on Friday. This brings inflation to 4.5% for the first ten months of 2026, matching the annual rate, influenced mainly by rises in fuel, transportation, and food prices, significantly weakening the purchasing power of Chilean families and delivering another economic blow to the government of José Antonio Kast.

The report details show that the inflation increase is not an isolated event but is driven by specific pressures in key sectors. In October, six out of the thirteen divisions in the CPI basket contributed positive incidents, while five showed negative incidents, and two recorded no significant change.

Among the divisions that experienced price increases, transport (2.0%) and non-alcoholic food and beverages (1.0%) stood out, collectively accounting for nearly half a percentage point (pp) of the index’s impact. Conversely, apparel and footwear was the only division to show a significant monthly decrease (-4.1%).

The remaining divisions contributed to the CPI increase, collectively accounting for 0.201 pp.

Transportation and Food Price Increases Squeeze Chilean Households

The transport sector was the leading driver of this inflationary surge, with a 2.0% monthly rise, primarily due to a spike in fuel prices for personal vehicles (5.6%), which alone contributed 0.225 percentage points (pp.). Within this category, gasoline saw a significant increase of 4.5%, contributing 0.157 pp. and accumulating 26.2% so far this year.

Additionally, air transportation experienced a surge, with international air travel rising 13.0% (contributing 0.071 pp.), while domestic air travel fell by 11.8%, reflecting volatility in the sector.

Meanwhile, diesel prices saw a monthly increase of 12.3%, accumulating 53.5% year-over-year, highlighting sustained upward pressure on logistics and transportation operational costs.

In parallel, the food and non-alcoholic beverage sector also severely impacted the budgets of Chilean households.

This division noted a 1.0% monthly increase, with 13 out of its 15 categories recording price hikes.

The principal driver was the category of vegetables, legumes, and tubers, which contributed 4.6% increase, adding 0.114 pp., followed by breads, cereals, flours, and pasta with 0.8%. In terms of specific products, potatoes (12.0%) and tomatoes (11.2%) exerted the most pressure on the index, with contributions of 0.040 pp. and 0.038 pp., respectively.

This rise in basic product prices is particularly challenging for households, as the basic basket is directly affected, limiting purchasing capacity and forcing families to readjust their budgets.

In contrast, the Clothing and Footwear segment reported a 4.1% monthly decline, contributing -0.098 pp. to the overall variation. This decrease was driven by drops in clothing (-3.9%) and footwear (-4.7%), with specific products like men’s sneakers (-5.4%) and men’s trousers (-5.5%) showing significant reductions.

According to the report from the INE, the overall trend remains upward, with an annual rate of 4.5%. Rising prices in gasoline and food continue to exert pressure on inflation, creating a challenging scenario that demands attention from La Moneda.