If this information materializes, it would represent a slight slowdown with respect to the rise of 5% that -according to the consultants estimate- had the food in May. This seems to be, in fact, a trend in recent months: after the peak of februarywhen according to INDEC food and beverages rose 7.5%this item began a downward path (although always at very high levels): it was 7.2% in March and 5.9% in April.
As explained by Damián Di Pace, director of the consulting firm Focus Market, this phenomenon could be due to a drop in demand. “There is a slowdown because such an increase cannot be validated with a sharp drop in demand. It is impossible. Mass consumption has been falling at a rate of 8.4% and food is one of the categories that has fallen the most. So, obviously, we are coming from a slowdown, but at a very high level. Food gave us a rise of 4.9% in the month of May, let’s suppose that it can drop to 4% in June: it is still a very high level”, he remarked.
“There is a slowdown with respect to the peak of the war, but it is still a very high inflation in food, for the purchasing power of income of Argentines. It is very worrying: because it is causing food consumption in Argentina to fall and behind that there is destitution and poverty, “added Di Pace.
Meanwhile, Camilo Tiscornia, director of C&T Economic Advisors, told Ambit: “I believe that food lost a bit of momentum. I think there was a shock in the third week of March, which was when many prices shot up on the international scene. From then on, there was a moderation. And, if we go a little further back from the war, in the summer, in January and February food also rose a lot affected by the weather: Due to the heat and the lack of rain, vegetables -especially- had strong increases. Then the war came in March and then, a little, it ‘loosened’”.
In any case, as analyzed by Tiscornia, during the first week of June “a very important change of pace was not observed.” “Food continues to rise at 5% average, compared to the same week in May. And I would say that with quite generalized increases: there is not a single thing that is going up, everything goes up. Many factors also begin to play, at the moment they adjust Care Prices, for example. But for now I don’t see a brake in the very short term”, he remarked.
For his part, Nicolás Pertierra, chief economist of the CESO, pointed out: “We have to see what happens with international prices. That is the only factor that I see today that can accelerate prices even more, a new shock. If it is due to internal dynamics, no cost should justify a new acceleration.”
The economist clarified, however, that “They should not be accelerated, but nothing concrete is seen that reduces inertia in a very strong way.” “There is no concrete policy for that, only ‘expectations’ and it is very difficult. So it seems to me that this cruising speed is maintained,” added Pertierra.
Inflation will be around 5%
With this scenario, it is estimated that general inflation will return to around 5% in Junea figure similar to the one that -according to the consultants- May would show. “It would be located at 5.1%, continuing the downward trend present since the maximum registered in March (6.7%, according to INDEC). This increase is driven by increases in gas rates (between 18.5% and 25%) and electricity (16.5%), prepaid (10%) and schools in PBA (8%)”, they pointed out from EcoGo.
Along the same lines, from Ecolatina they estimated that “would be located again above 5%where the expected increase in public service rates will impact along with other regulated prices (such as prepaid), together with the salary driver, which remains on after joint negotiations.
“In this way, the inflation of the second quarter would close slightly above the accumulated rise of the first three months (which was 16.1%). In this way, the evolution of the first semester leaves a high floor for the year: we estimate that inflation closes around 70% yoy in 2022even projecting a slight slowdown in prices for the last six months of the year”, they concluded from Ecolatina.
Source: Ambito
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
