The inflation April was above what the market expected, marking the highest monthly variation since the same month of 2002. In this sense, after the rise in the 8.4% in the CPI registered by the INDEC last month, for May, private consultancies are already forecasting a “Raised floor” and they do not rule out a number even above the one released last Friday.
It is that at different punctual increases of “regulated”, will be added the drag of the increases from the last weeks of April, impacted by the jump in the alternative dollars. In this scenario, the first private surveys show a certain acceleration in the sector foodthe one with the highest incidence in the indicator.
For example, from Fundación Capital they warned that “May already has a high inflation floor (around 8%), having the full impact of the jump in financial dollars, while registering important regulated price adjustmentswhich will add 1.5 points to the CPI for the month”.
“In detail, electricity and gas rates per network increased by 32.2% and 25%, respectively, on average for residential users, although the impact will be very different depending on the consumer (an issue that we will focus on in the second section). Likewise, the new increase of 7.8% in the AMBA public transport (buses and trains), a service that since March has been indexed to the behavior of the CPI of the GBA, so any inflationary jump will be quickly reflected in the rates of the sector”, they highlighted from the firm.
“For his part, he subway It increased 15.5% in the fifth month, after the 35.5% rise in March, and new increases of 10% in June and 8% in September are already scheduled, which would bring the ticket to $80. Also, like every month, the prepaid They adjusted their quotas according to the sector’s cost index, which in this case was 4.8%, accumulating increases of 33% in the first five months of the year. Even more, in May the tariff for telecommunications services increased (cable television, internet and cell phone) by 8%, accumulating an increase of 37% in five months. Finally, the 4% monthly increase in fuels was applied, within the framework of the Fair Prices program, ”he added.
In this context, from Ecolatina they remarked that “For May inflation will probably be closer to 9% than 8%.” Beyond the aforementioned increases, “the drag left by the increases in the last week of April will be added, essentially motivated by the jump in free dollars, which were not fully captured in the April index.”
“The dynamics of current inflation is fueled by strong inertia, increasing indexation and shortening of contract termstogether with the uncertainty inherent to the electoral transition and the absence of traditional anchors: there is no margin to freeze public service rates or substantially delay the official exchange rate (as occurred in the face of the 2021 elections), while the parities will exert pressure in the electoral year ”, they detailed from the consultant.
First surveys of May
The different price surveys carried out by private firms, in fact, reveal a certain acceleration in prices in the first weeks of the month. For example, from the Libertad y Progreso Foundation they indicated: “With data up to May 12, consumer prices registered a rise of 7.3% so far this month, showing a strong acceleration compared to what was accumulated in the first two weeks of April (5.3%).” .
“The month of May aims to close with inflation with a floor of 8.6%, which would be the highest record for a single month since April 2002 (10.4%). This assuming the evolution of prices behaves in the same way as in the last two weeks of March, that is, under an optimistic scenario in which there is no disruptive event such as the currency run in the second half of April ”, detailed.
In this sense, Lautaro Moschet, Economist of the entity, analyzed: “The dynamics of the last few weeks show that the inflation floor is getting higher and higher. The rise in interest rates managed to contain the currency run for the moment, but the jump in the level had a strong impact on prices. Although of course, at the expense of raising the quasi-fiscal deficit. In turn, there are more and more goods and services indexed in the economy that are updated monthly”.
Along the same lines, the price survey carried out by the LCG consultancy also accelerated in the first two weeks, accumulating a 4.8% rise. “For May our projection is a floor of 8% per month”, they projected from the firm, and concluded: “Inflation expectations seem to be the ones that maintain increasingly higher monthly inflation records. Neither price control programs, nor activity pushing very weakly, nor wages losing the race against prices, help to curb the inertia and price remarks that occur in a closed economy”.
Source: Ambito
