In this context, Different analysts estimate that inflation this month would once again reach double digits.. Food, meanwhile, would once again put upward pressure: in this case, meat may once again have a determining role, due to the rise in the price of livestock.
For example, according to the analysis of the consulting firm C&T, the September data “were strongly influenced by the peak that the vast majority of the economy’s prices had during the second half of August.after the jump that all exchange rates had experienced following the primary elections”.
Meanwhile, according to the data from the C&T price survey, “a subsequent moderation was observed throughout September, but that began to reverse strongly in the second week of October, based on the new spike in financial exchange rates”.
Along these lines, the consulting firm ACM indicated that, for October, “It is likely that we will see more strongly the effects of the different measures to recover consumption announced in September by the government”. “Added to this is the exchange rate volatility resulting from pre-election uncertainty, which is likely to experience an additional transfer to prices, significantly accelerating inflation in October,” they highlighted.
For their part, LCG indicated that, “looking to the future, probably the monthly inflation record for September should be considered as a new floor”. “The rise of free dollars will have an impact on price formation. The widening of the gap has already translated into price correction in the past,” they analyzed.
“And it is also likely that this impact will not be limited to October. It will continue to have a bearing on the dynamics of the coming months. This without considering that, after the elections, the Government will have to move forward in making the controls that it has been promoting more flexible, which will add even more pressure,” they concluded from LCG.
“With the first data for October, the pace of price increases indicated that the CPI for the month would once again be in single digits and would close below 10%. However, with the deepening of the run against the peso and the drag of September, the month will most likely be in double digits again. If, on top of this, a new jump in the official exchange rate occurs without an economic program, then October could even be above August and September,” analyzed Eugenio Marí, Chief Economist of the Libertad y Progreso Foundation.
Food inflation
Food was the division with the greatest impact on inflation in September. And this trend could be repeated in October, if the surveys of the first days and the role that a new rise in the price of meat can play are considered.
“Facing the October elections, uncertainty reigns and although the drag left by the devaluation and the result of the PASO was diluted, Inflation still remains in double digits. Inflation of food consumed at home in October would reach 9.6% monthly. This considers a projection of 3% for the next three weeks of the month,” stated Eco Go, which recorded an increase of 2.3% in the first week of October.
Meanwhile, according to the LCG survey, “In the second week of October, the increase in food prices averaged 1.7%, accelerating 0.3 pp compared to the previous week”. “The food and beverage index presented monthly inflation of 7.1% average in the last 4 weeks and 6.7% end to end in the same period. So far this month inflation has accumulated 3.2%,” they concluded.
Source: Ambito
