August closed with a strong jump in the inflation monthly. As expected, this was reflected in the surveys of different consultants private, which locate the variation of the CPI in the order of 11%. The food item pushed the index upwards, in a month marked by the devaluation of the official dollar and the volatility of alternative exchange rates.
Another factor that influenced the variation in inflation last month was the rise in the meatwhich had been behind in recent months, and took a strong leap from the launch of the “dollar corn”. Thus, different consultancies measured the highest inflation in more than thirty years. The official data will be released next Wednesday the 13th.
By case, according to the CPI that measures the Freedom and Progress FoundationAugust inflation was 10.7% monthly (in July the firm had measured 6.6%, compared to the 6.3% reported by INDEC). “This result marks the highest monthly rise since March 1991, even exceeding the record of April 2002, in the midst of the exit from Convertibility. For its part, the year-on-year variation amounted to 120.8%. You have to go until September 1991 to find a record of that magnitude,” they explained.
the item “Food and non-alcoholic beverages” presented a rise of 9.9%, with an incidence of 2.3p.p. in the index. “Despite being the one that contributed the most to the rise in inflation, there were six items where the magnitudes of the variations were higher and were located in 2 digits. Among them are ‘Medicine’, with an increase of 16.0%, followed by ‘Communications’, with 15.2%, and both ‘Housing’ and ‘Education’ share third place with increases of 14.5 % in both cases. Finally, ‘Housekeeping’ and ‘Various goods and services’ grew 13.1% and 11.4%, respectively”, detailed from Libertad y Progreso.
According to Eugenio Marí, Chief Economist of the Foundation, “the increase registered in the CPI during August generates a carry-over effect of more than 4 points for the September index”. “Assuming there are no other shocks like in August, core inflation dynamics are already close to double digits. Although the price freezes ordered by the government, which include fuel and transport, among others, will help temporarily moderate the index. But at the expense of continuing to accumulate repressed inflation, ”he detailed.
For his part, the S&T survey registered an inflation of 11% for the GBA region (it had been 6.3% in July, same data as INDEC). “Thus, the monthly variation exceeded the previous peak of 10.4% in April 2002, immediately after Convertibility came out, and equaled that of March 1991, the month prior to the start of said program. It should be noted that August is a favorable month from a seasonal point of view, since inflation tends to moderate after the peak it has in July due to tourism,” they explained from the firm.
“Prices had already been showing an acceleration since the second half of July, but there was an additional change in dynamics after the jump in all exchange rates on August 14. This meant that, comparing the last week of the month against the same week of July, an increase of 14.7% was verified, much higher than the average data for the month, and that leaves a drag of 5% for September”, detailed from C&T.
Surveys
Some polls even place August inflation above 11%. It is the case of Ecolatina, which estimated a rise of 11.2%. “The record for the month was mainly driven by the rapid transfer to prices of the discrete jump in the official exchange rate, the escalation in parallel dollars and the adjustment in bovine meat prices after the marked increases in the price of live cattle ”, they pointed out from the firm, and detailed: “The chapters that led the rise were Household equipment and maintenance (+16.8%), Health (+13.6%) and Food and Beverages (+13.5%) ”.
For its part, the CPI for the GBA of the consultancy orlando ferreres recorded an inflation of 12.2% (it had been 6.6% for July). “Regarding the main items, Recreation, Home equipment and operation, and Education led the increases for the month, registering monthly increases of 21.0%, 18.7%, and 18.5%, respectively, followed by Food and beverages, which presented a variation of 12.4%”, they detailed from the firm.
All the consultants also agree that the food item had a marked incidence in the monthly variation. For example, the survey of Food and Beverages carried out by GCLshowed an average monthly inflation of 10.1%, while in the measurement “from end to end” an increase of 12% was observed.
According to the firm, vegetables rose 12% and meats 11.3%, the latter being the ones with the highest incidence within the monthly variation.
Source: Ambito
