The inflation in Uruguay continues downward showed the last Consumer Price Index (CPI) produced by the National Statistics Institute (INE) which for the month of August was 0.17%, accumulating 4.11% in the last 12 months.
The main incidence to bring down, even below the target range of inflation proposed by the Central Bank of Uruguay (BCU)occurred in the item with the highest weighting in the CPI: food and non-alcoholic beverages.
In this segment, the drop was 0.74%, with a special impact from the fall in the prices of fruits, vegetables and meat as a result of a drought that is beginning to ease.
But an effect has also begun to be observed in other goods of retail consumptionsuch as those that make up the hygiene basket or those of the clothing item, which, in effect, was the one that fell the most during August, reaching -2.07%.
Analysts point out that, at a commercial level, the exchange difference with Argentina is having an impact to lower inflation in Uruguay, stopping increases or even motivating losses, especially in the items mentioned above, which is where the greatest price gap.
In the month of July, for example, the border price report prepared by the Salto Economic Observatory of the UCU showed that the category of Household Products -which includes the hygiene basket- marked the largest price gap, which was 179%, being the highest since 2015.
The most significant price differences are evident in powdered soap and detergent, with gaps of 263% and 211% respectively.
Thus, the drop in relative prices with Argentina has exported deflation to the Uruguay. Conversely, in the cities of Between riversmerchants and consumers warn that the arrival of Uruguayans causes an increase in prices as demand grows and not supply.
Source: Ambito
