After resuming the upward trend in December (5.1%), inflation is worrying again in January. An acceleration in food prices, seasonal increases and various regulated prices drive the inflationary needle towards a mark close to 6% per month, according to analysts.
Meanwhile, the government is trying, through programs like Fair Prices, to inflation does not exceed 5% in January and 30% in the first half of the year since the 2023 Budget expects prices to increase at a rate of 60%.
However, the objective appears optimistic, bearing in mind that throughout the year the increases in tariffs, the change in the exchange rate (which in the last week exceeded 370 dollars), the management of the debt in pesos and the presidential elections , among other factors .
In this scenario, some consultants estimate that the end of 2023 will be similar to last year in terms of prices, when the CPI accumulated 94.8%, according to INDEC. The Survey of Market Expectations (REM) prepared by the Central Bank predicts that by June of this year the CPI will be at 64.6%, which means that by mid-year, the 60% target will already be exceeded of the inflation forecast by the Government for the entire year.
For now, 2023 is off to a rough start. January, a seasonally inflationary month due to the impact of tourism, also adds fresh impetus to basket prices.
The latest survey by the consultancy LCG – which measures 8,000 online products in five supermarket chains – indicates that “the food and beverage index showed a monthly inflation of 4.5% on average over the last 4 weeks and 5.6% end-to-end during the same period”.
With regard to what happened in the third week of January and overall of the previous four, the consultant’s index showed that the greatest increases were again observed in fruit and vegetables (6.9%), followed by dairy products and eggs (5.6%) and drinks and infusions.
In the period under review, the percentage of foods with increases fell to 22% of the total. However, this indicator “continues to accelerate,” they clarified in the advisory. Furthermore, according to these documents, five of the 10 study categories are 5% above the monthly average.
Vegetables (8.9%), fruit (8.3%), dairy products and eggs (6.2%), condiments (5.8%), drinks and infusions to be consumed at home (5.2%). Below are ready meals (4.7%), oils (4.5%), bakery products (3.5%), sugar (2.2%) and meat (2.2%).
Another indicator of the inflationary impact on the family table is the basket surveyed by the user agency Consumidores Libres. In the first fortnight of January, the result of this survey stated that the increases – in the Buenos Aires city area – averaged 2.27% with fruit and vegetables leading the increase and “well above of average inflation”.
As regards the evolution of the general index for the month, economists warn – armed with initial estimates – that the average rise in prices will reach 5.5% or 6%.
For example, from Equilibra, the economist Lorenzo Sigaut Gravina underlined that the projection is slightly higher than that of December due to the strong increases implemented in regulated and seasonal prices. “We expect an increase in the month around 5.5%”noted the analyst.
The consultancy company Lcg also expects the summer months to continue with the dynamics of December: “we expect a January-February two-month period with inflation that does not exceed 5.5% per month”, reads a statement.
For the Ferreres&Asociados study, the last few weeks measured gave an increase of 3.9%. Within that result, food and beverages saw an average increase of 4.1%. Taking into account this basis, the prediction is that January ended with an increase close to 5%estimate in this consultancy.
Even for consultancy firm Eco Go, the latest food and beverage records show they will grow the item at a monthly rate of 4.4%, if applied a 0.8% change for the remaining weeks of the month.
In addition, the advisor warns that other elements have a special bearing on inflation for the month: increases in prepaid fares (6.5%), fuel (2%), gas, electricity and water (respectively 14.1%, 19.6% and 20.1%), domestic services (6.5%), buses and trains in AMBA (between 20% and 70% depending on the service), among others.
Finally, from the Libertad y Progreso Foundation, they ensure that “taking into account the dynamics of recent weeks, January would end with an increase in 6.3% – the highest figure since October-. In that case, the inter-year variation would sit at 99.3%,” he said.
Source: Clarin
