The good news, if you will, so far this month, is that food would have shown some slowdown. Data that also helps to prevent the general index from being even higher.
In fact, as pointed out by Libertad y Progreso, the CPI produced by the foundation showed an accumulated growth of 4.9% in the first fortnightwhich represents 0.7 percentage points less than in the same period of the previous month.
This is explained more than anything by the deceleration in the increases in the ‘Food and Non-Alcoholic Beverages’ category, while the greatest increases are in the headings of ‘Housing, water and electricity’ (16.4%), ‘Alcoholic beverages and tobacco’ (8.5%), ‘Various goods and services’ (8.2%) and ‘Education’ (6.5%)”, they pointed out from the firm, and concluded that “a variation of the CPI for the month of November of something more than 6% could be projected”.
“As the Vice Minister of Economy rightly mentioned, Argentina’s macroeconomic imbalances make the country flirt with hyperinflation. To avoid this outcome and for Argentina to start growing, a combination of fiscal, monetary, and production measures is necessary that simultaneously restore fiscal sustainability, lower inflation, and restore incentives for investment and production in the private sector,” he said. Eugenio Marí, chief economist of the Libertad y Progreso Foundation.
For their part, from EcoGo they projected that general inflation for November would be 6.6%. “Regulated products drove the general indicator for the month upwards, highlighting increases in electricity, gas and water rates (18%, 10% and 25% on average), taxis (20%), schools in PBA (6.5%) , expenses (10%) and fuels (7.2%), among others”, they pointed out from the firm.
For its part, the survey of foods from the LCG consultancy accumulates an increase of 2.5% so far this month, “a dynamic quite different from that of the previous months”. “For its part, average monthly inflation slowed for the fifth consecutive week, returning to 5%, the lowest value in twenty-seven weeks (month of May),” they said.
With this scenario, and considering the increases in different regulated items, “and an inertia that remains high”, since the signing They projected inflation for November with a floor of 6% per month.
Inflation: the government’s goal
The slowdown in foods of this month coincides with the launch of the program Fair Prices. It is one of the tools with which the Government seeks to contain the inflation in the coming months.
In fact, Massa confirmed days ago that the goal is to reach April 2023 with a inflation which is located below 4%. “I raised it by assuming: we established ourselves on a path of inflation reduction, lowering one point of inflation every 60 or 75 days. Somehow we started at 7.5%, we parked it in the second two months at 6.2% in September and 6.3% in October, and we aspire to follow a path of reduction. The goal is to reach April 2023 with number 3 ahead“said the minister.
In this regard, from the Sarandí consultancy they indicated that said objective “it would mean halving the price index from current levels.” “It is hard but not impossible. In any case, it is convenient to start paving the way with concrete and verifiable quantitative goals”, they remarked from the firm.
In this scenario, a report from the consulting firm highlights that the plan began with the price agreement on basic products. “Off the bat, Precios Justos doesn’t seem very different from a continuation of Precios Cuidados or other agreements that failed. Its success rests on the fulfillment of agreements with incentives that are not always aligned”, they remarked from the firm, and detailed: “The main risks are non-compliance with the agreed prices and the shortage of products on the gondola. It will depend centrally on the stability of the nominal variables”.
Source: Ambito
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