“In the third week of the month, the LCG food inflation index marked a rise of 0.8%, decelerating by 1.2 pp compared to the previous week. But beyond this slowdown, So far in May, food inflation averages 1.4% weekly”, pointed out the consultant in its report, adding: “Compared to the same weeks of April, the rise in food amounts to 5.3%. The percentage of products with an increase remained high (24%), which implies that, if it remains at that level, all the products in the surveyed food basket will have increased at least once in May.”
For its part, according to the survey carried out by EcoGo, in the second week of the month food went up two% compared to the previous week. “With this data and considering a projection of weekly variation of 1% for the next two weeks of the month, the inflation of food consumed at home in May would climb to 5.5% monthly”, analyzed the firm.
Meanwhile, according to the usual study carried out by the Free Consumers organization, the cost of a basic basket food climbed 2.4% in the first fortnight of the month, for which they accumulate an advance of 25.3% so far this year. In May, as indicated, the main increases were observed in warehouse products (3.5%), while meat increased 2.4% and fruits and vegetables, 0.5%.
Increases in food prices have a major impact on the levels of poverty and indigence. In fact, last week the INDEC announced the evolution of these indices: the basic food basket rose 6.7% and one family needed $42,527 to not be indigent. While $95,260 was required to not be poor.
May inflation would exceed 5%
With the pressure that rises in the foodcoupled with specific increases, it is expected that inflation in May would exceed 5% againconsistent with a rise in the CPI that they estimate could be around 70% in the year.
“The inflation figure for May would be 5.2%”estimated the consulting firm EcoGo, which also highlighted the expected increases in categories such as “housing, health and education, driven by increases in prepaid (8%), schools in PBA (8%), fuels (7.4% on average), domestic service (12%) and expenses (around 12%), among others”.
“The stage of correction of the relative prices of the economy begins. The official exchange rate is being devalued to 4%, when it was below 3%. The next few months will see the increase in the prices of water, electricity and gas which will be stronger in industry and commerce than in the home.In turn, increases in Fuels and only in the first quarter of the year, according to Paetac, Freight transport had an increase of 25%. parity adjustments will have an impact on the structure of costs and prices, and on many sectors of the economy there are still inconveniences to obtain dollars to import”, analyzed Damián Di Pace, director of Focus Market.
In this context of strong inertia, the Government decided last Friday a “reorganization of functions in order to strengthen actions linked to the productive reactivation and the addressing the inflation problem”.
One of these changes is that the Internal Trade Secretariat will depend “functionally on the Ministry of Economy, where the current Secretary Roberto Feletti will continue in his position.” “This transfer will exclude some specific functions that will depend on the Industry Secretariat in the Ministry of Productive Development,” it was noted in an official statement.
Source: Ambito
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