The Central Bank announced yesterday that the official inflation rate for 2003 was 42% — more than it has ever been in the past 10 years. The Central Bank chose not to factor the increases in the power rates in their calculations, reported El Caribe. The monetary authorities are optimistic for 2004, as they set the 2004 inflation rate at 14%. The International Monetary Fund (IMF) had expected 2003’s inflation rate to reach 35.5% by year’s end. According to the Central Bank statistics, the CPI (Consumer Price Index) has been changed more than four times recently, with the last adjustment made due to the agreements reached with the IMF. The Central Bank reports that the principal cause for the rise in inflation has been the devaluation of the Dominican peso, and, to a lesser degree, the higher oil prices. With the inflation rate formally published, the government now needs to announce the wage level that will be exempt from payment of income taxes. There is a bill in Congress to increase the wage tax exemption level to RD$20,000 a month, which would closely reflect the official exchange rate. Income taxes would only be paid over the tax exemption amount. In previous years, the government has made the announcement before the end of this month. The inflation rate in 2002 was 10.52%.