Inflation for December 2022, the latest measurement for the past year, was 5.1%, according to the consumer price index (CPI) reported this Thursday by the National Institute of Statistics and Census (INDEC). In this way, the accumulation of the last twelve months is 94.8%ending the worst year in three decades.
The highest inflation of the year and of the entire administration of Alberto Fernández continues to be that of July, when it reached 7.4%. That mark was the highest since April 2002, when it reached 10.4%. Then it fell to 7% in August and 6.2% in September and rose to 6.3% in October. In November it was 4.9%.
In 2021, the annual CPI had jumped 50.9%, while the Budget presented by former minister Martín Guzmán projected 55.7% for 2022. Meanwhile, a number worse than the one revealed this Thursday is only in the 1990, when it was 1343.9%.
In the data corresponding to December, the division with the highest increase was the Catering and Hotels (7.2%), ahead of Spirits and Tobacconists (7.1%). Also noteworthy is the increase in the domestic service, which had an impact on domestic equipment and maintenance (5.9%); of fuels, with an incidence in Transportation (5.8%); and the share of prepaid medicines, within the Health division (5.7%), reports INDEC.
In terms of incidence, food and soft drinks (4.7%) had the greatest influence on the final number in almost all regions: in Greater Buenos Aires it contributed 1.35 points compared to 5.3% which showed the regional inflation index. The GBA was the area that recorded the largest price increase, ahead of the Pampean region (5.1%) and Cuyo (5%).
Every year, Greater Buenos Aires had 95.2% inflation. In that period, Food and Alcoholic Beverages was the one that contributed the most (explains 23.89 points of the index) and is followed by Clothing and Footwear (11.58).
In the previous weeks, Economy Minister Sergio Massa had forecast inflation below 5% for December, although private consultancies still estimated a number between 5.5% and 6%.
“November closes with 4.9% and December, according to the projection of the Secretariat of Economic Planning, I would also be with the forward four. Let’s see when Indec publishes,” Massa said in an interview published on Sunday by the biweekly Profile.
Contrary to this forecast, inflation forecast for January by the Central Bank’s Market Expectations Survey (REM) was 6.1% in December and 6% in January. For the Centrale itself, “who best predicted short-term inflation (defined as the top 10 by the Centrale)” expected inflation “of 5.2% for December 2022”, as reported by the agency a few days ago.
On Monday, the Buenos Aires City Department of Statistics reported an inflation rate of 5.8% for December, the same as in November in the Buenos Aires area. Already in the eleventh month of the year it had deviated by almost one point from the national measure.
For its part, on Friday last week, the Central Bank’s market expectations survey reported 95.5% annual inflation for 2022. And a projection for 2023 of 98.4%. This placed it 1.3% below the previous month’s estimate, which showed a decline in expectation of the December numbers, finally released today.
With the inflation numbers for the last month of the year on the table, 2022 has finally been left the highest rate in 32 years. The slowdown in recent months prevented the 100% barrier from being crossed, but although the final figure was close to that figure, it largely exceeded the 83% in 1991, the year the Convertibility was launched.
The Government aims to slow inflation in 2023 and to agree parity agreements around 60%
Sergio Massa has assured in recent days that one of his goals is to arrive in April “with a 3 ahead” in the inflationary number. In doing so, he clarified that the government wants the price index to slow down in the first months of the year.
For his part, this Thursday, the Minister of Labor, Kelly Olmos, confirmed that he will seek that joint agreements do not exceed 60% this year, as Clarín had anticipated.
“It would converge towards the planned level of inflation plus some recovery point on top of that Reducing inflation also implies an improvement in the purchasing power of wagesHighlighted elm.
In this context, he explained that it is not an agreement with the unions in general that salary increases do not exceed 60%, but that it is a policy that is specific to the Executive.
“It is not an agreement, it is a policy that we promote. In the same way that last year the Government, faced with the inflationary spectacle or the inflationary explosion that occurred in the middle of the year, promoted the reopening and revision of the relatives negotiations to prevent it would be a significant loss of purchasing power from wages,” Olmos said.
The truth is that the central bank’s survey of market expectations in December left an inflation forecast of 98.4% for all of 2023, a far cry from what Alberto Fernández’s government now hopes to achieve.
Olmos indicated that what has been done so far is “talking to the actors about the need to go converging towards a deceleration of nominality and inflationalso as a method of recovering purchasing power”.
With an “optimistic” forecast of slowing inflation, the national official said the initiative was part of the “responsibility to make every effort” to achieve inflation targets.
Regarding the fact that the CGT supports the request that wage increases do not exceed 60% in 2023, he replied: “In general, yes because there is an awareness, especially the union sectors more than some business sectors which often agree to increase nominality and then turn around and give it back to prices”.
Source: Clarin
