As seen in the official data released in recent weeks, in the first quarter of the year there was growth in the economic activity which was driven, among other factors, by the consumption. However, according to private estimates, this trend would change in the future: they warn that the domestic demand will suffer from the impact of accelerating inflation.
By case, according to data from INDEC, supermarket sales grew 3.8% in March and accumulated a rise of 1.9% in the first quarter. For his part, sales in large shopping centers increased by 6.9% year-on-year.
It is that, as it emerged from the last EMAEhe “Wholesale, retail and repairs” was one of the divisions that had the greatest positive impact on the year-on-year variation in economic activity, which it grew 1.3% in March and accumulated an improvement of 1.5% in the first three months.
Based on these records, private projections for the coming months are not so optimistic. The thing is A slowdown in the level of activity is expected, as a result -among other aspects- of consumption with less momentum.
“We expect all components of aggregate demand to deteriorate during 2023. On the one hand, we anticipate a setback for private consumptionwhich will suffer the deterioration of the real salary and the income of the households most dependent on the State (beneficiaries of allowances, pensions, etc.) in the face of an inflationary escalation that we do not expect to be fully mitigated by parity negotiations and given the limited space tax to promote a robust income policy ”, analyzed from Ecolatina.
“In this frame, the purchasing power of registered workers would exhibit the sixth consecutive year in decline (We calculate -2% for 2023), while the correction of public service rates will have a direct impact on the income available for consumption by families,” the consultant detailed.
Consumption: what are the projections
Along the same lines, from LCG they projected: “With inflation on a floor of 7-8% per month, the speed with which purchasing power is lost generates a substitution of ‘sumptuous’ consumption (related to leisure) by essential consumption (supermarket, for example), so we are not optimistic that consumption will drive activity. This is relevant, given that in 2022 the increase in the price of the parallel dollar generated a substitution of savings for consumption, a seasoning that we do not see will be present during this 2023”.
Meanwhile, from Fundación Capital they announced that “all the engines of economic activity show signs of deterioration.” “The fall in the purchasing power of families, which could deepen with rising inflation, will be felt in private consumption, which would fall 1.4% yoy., although with heterogeneity between items”, they estimated.
In this scenario, the first private and sectoral surveys related to consumption exhibited negative variations in April. By case, from Scentia warned that mass consumption fell 0.3% year-on-year in April, to accumulate a contraction of 0.6% in the first four months of the year.
For his part, SME retail sales had a slight annual contraction of 0.1%, therefore they accumulated a retraction of 0.7% in the first four months of the year, according to the CAME. In the monthly comparison, on the other hand, businesses sold 0.7% more than in March.
“The trade situation is being delicate. Costs rise daily and 55% of the companies consulted stated that they had difficulties in stocking up on merchandise in April. The most complicated businesses were perfumeries, hardware stores, construction materials, electrical and clothing”, they explained from the entity.