In a month marked by change of governmentthe end of the agreements of prices and the strong devaluationthe inflation it shot up in December. So much so that after November’s 12.8%, different private consulting firms estimate that it will exceed 25% and could even approach 30%.
Waiting for what may happen with the rates and other regulated services, Analysts predict a certain slowdown for January, although it will remain above 20%. And they project an increase in the CPI of the order of 80% for the quarter between December and February.
From the consultancy C&T they estimate that inflation will be around 25% in Decembera data similar to that expected by Ecolatina. Meanwhile, since the Freedom and Progress Foundation They projected an increase in the CPI around 29%after its survey recorded an increase of 24.6% in the first three weeks.
“The rise in the CPI in December is explained by the release of prices that were artificially delayed. Something that had served to show a lower CPI in previous months, but which was unsustainable. Now we see that regulated prices are recovering lost ground and rising more than the rest,” explained Eugenio Marí, Chief Economist of the Libertad y Progreso Foundation.
For its part, since Eco Go They projected an inflation of 29.4% for December. “In a context where prices continue to adjust after the devaluation and the publication of the DNUthe survey corresponding to the third week of the month recorded a variation of 11.3% in food prices with respect to the previous week,” the firm stated and detailed: “With this data and considering a projection of weekly variation average of 5% for the last week of the month, inflation of food consumed at home in December would climb to 35.3% monthly.”
Inflation: what can happen in January
After the December jump, and beyond what is expected adjustments to utility, transportation and prepaid rates, among others, different analysts consulted did not rule out a slowdown in inflation in January. Although, of course, it will continue at very high levels.
“It is not clear that it will accelerate even more in January”Camilo Tiscornia pointed out in this regard, who analyzed that after the shock of December increases in different goods, “we will have to see carefully which regulated services increase and by how much, many details are missing.”
In the same vein, Rocio BisangEco Go analyst, said: “For January we expect to see a certain slowdown in inflation, although it would still remain at high levels, around 20%. This would respond a little to the same seasonal dynamics of inflation, which makes December generally higher than January, to the exchange rate anchor and also to the contraction of consumption with salaries that, at least for now (in these months the high season begins of joint negotiations), they do not completely accompany the price increases.”
“Obviously, The increase in regulated prices is going to have a very strong impact on the index, although it remains to be seen what increases and to what magnitude they will finally be applied.. In particular, the electricity and gas rates, for which a hearing was called in the first days of January, as well as the increases for the train and buses and fuels,” Bisang stressed to Ambit.
Inflation above 20%
Santiago Manoukianhead of Research at Ecolatina, estimated that in January “inflation is going to be above 20% again, but perhaps it could be a little lower than December”. The economist maintained that the data for the first month of 2024 will be affected “by the negative drag left by the inflationary acceleration of the second part of December.”
“It is unknown what the sequence and magnitude of the relative price adjustments will be. that we are going to have in January, beyond the specific increases that we already know that are going to ensure that inflation remains very high in January,” Manoukian said.
And he concluded: “Beyond the specific increase that we have in January, after this strong increase that we had in December, I would say that for the December-February quarter we expect there to be an accumulated inflation close to 80%. Inflation is going to remain extremely high, higher than what we had until November. The point is whether the Government is going to achieve a fairly ordered ordering of relative prices. In terms of avoiding forward inflationary pressures from sectors that still want to rebuild their prices even more. And that is going to be a necessary condition to be able to stabilize the economy.”
Source: Ambito
