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warn that food rises strongly and adds pressure to the CPI

warn that food rises strongly and adds pressure to the CPI

During April, the food and non-alcoholic beverages went up 10.1% and it was the item that most influenced the inflation will jump to 8.4% monthlyas reported by INDEC. As can be seen from different private surveys, this trend seems to maintain a similar trend in May. A fact that, added to different punctual increases and the inertia left by the last weeks of last month, would decant in a variation of the CPI once again above 8%.

By case, according to the survey carried out by the consultant eco go, in the third week of May a variation of 2.6% was registered food prices compared to the previous week. “With this data and considering a weekly variation projection of 1.8% for the last week of the month, inflation of food consumed at home in May would climb to 9% per month. If we also consider the evolution of food consumed outside the home (10.6%), food inflation would reach 9.3%”, they analyzed from the firm.

For its part, the survey carried out by the firm GCLhad an increase of 1.3% weekly in the third week of the month, decelerating 2.3 pp compared to the peak of the previous week. “So far this month it accumulates a total increase of 6.1%. Beyond the increase, after three weeks, average monthly inflation managed to slow down and stood at 8.6% (8% end to end)”, they analyzed from the consultant and detailed that, in the third week, “the percentage of products with increases was below the average of the last four weeks: 24% of the total basket. This means that the total basket adjusts on average every 4.1 weeks (29 days)”.

Meanwhile, according to the report of the Foundation Freedom and Progressfood and non-alcoholic beverages had an increase of 7.4% in the first half of the month, “accelerating by 1.5p.p. compared to the second week of April and pointing to a rise of more than 9% in May”.

Consumption Inflation Basic Basket Supermarket

Consultants estimate that inflation in May would be similar to that of April

Mariano Fuchila

pressure on inflation

The strong rise surveyed by different private consultants in the item with the highest incidence within the CPI, adds more pressure to the general index for the month, which, according to estimates, will exceed 8% again. For example, from Libertad y Progreso they pointed out that in the first half of the month “consumer prices showed a rise of 7.3%, showing a strong acceleration compared to the 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%)”, they underlined.

“For May inflation will probably be closer to 9% than 8%”estimated for their part from Ecolatina, and detailed: “In the month the adjustments in electricity and gas rates, public transport in AMBA (buses and trains increasing +7.8%, subways +16%), taxis ( +20%), fuels (+4%), tolls (between 40 and 50%), prepaid (+3.6% on average), domestic service (+7%), building managers (+6%) and schools ”.

To the aforementioned will be added the drag left by the increases in the last week of Aprilessentially motivated by the jump in free dollars, which were not fully captured in the April index”, they remarked.

In addition, from the firm they warned about the “impact of import restrictions, prices more sensitive to movements of free dollars, incidence of devaluation expectations and the impact of the ‘agro dollar’ on certain foods, with a program ‘ Fair Prices’ with little influence”.

“For these reasons, we do not expect a slowdown in inflation in the coming months, with 2023 which, in the best of cases, it would close with an inflation of 130%. Could it be older? Probably”, they concluded from Ecolatina.

Source: Ambito

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