The Government will recalculate and expect inflation to be above 5% in April

At this time, all indications are that inflation in April will be worse than expected and this will again be reflected in food, a variable affecting income and poverty. The data did not reach the March record of 6.7%, the highest increase in 20 years, but it worries the government. “It could be a five and a littlesays an official source.

Until last week, the Government expected a figure of more than 4% and a gradual slowdown. Now, the number has changed upwards and they are predictable increase of more than 5% Will it reach 6%? The obvious is “no one will like it”they acknowledge in a ministry, where they expect a clearer signal from May.

Consultants expect the IPC to change between 5.3% and 5.7% due to the drag left by the advance in prices in March, as well as April increases in costs, schools and garages in the City, prepaid and domestic service. Part of the increase was also due to bread and meat, whose prices became more expensive because of the war.

“Unlike March, where the inflation component corresponds to certain components with updates (electricity, gas, fuel, health, among others), This month, inflation is more prevalent in all basket products, specifically food non-seasonal, ”explains Sebastian Menescaldideputy director of EcoGo.

There is no encouragement to handle grain preservesthe Executive launched a series of measures They went from trying to contain prices to reducing revenue. First are the regulated baskets and the increasing withholdings on soy derivatives to subsidize the price of flour. Then the combined shares are advanced and a bonus of up to $ 18,000 will be paid in May.

But the relief is temporary. After reaching a “ceiling” in March, inflation is at least going forward. Some economists estimate increases of about 5% through July and a floor of 65% per year. in a context of the commodity shock, added to the acceleration of the dollar since January and the continued increase in tariffs, two policies were agreed with the IMF.

This situation is fueling La Cámpora’s new offensive against Martín Guzmán, who has been blamed for the overflow of prices. Convinced that he has limited power, the economy minister is betting on stabilizing the economy with fewer fiscal deficits and financial issues. So he avoided a sudden devaluation, but inflation did not stop.

“The government reading is little it can do in the short term to prevent price shocks. Now the acceleration of inflation has nothing to do with the small machine and it is very difficult for Congress to pass an increase in withholdings to separate domestic prices from international ones, so they seek to ease the pockets by releasing parities, “said the economist. Rodrigo Alvarez.

The stagnation of prices has revived demand for dollars in recent days and provoked the tide of similar prices. The Central Bank was required to sell $ 65 million on Wednesday in the foreign exchange market. Although the dollar has accelerated to 4% per month, it is still low on inflation. IPC could add more forward pressure on the exchange rate.

“There’s a circular relationship, the rise in the official dollar and in parallels in a context where the government has failed to anchor economic expectations is driving up prices. And then this increase increases the need to update energy rates, the scope of savings by the dollar increasing its price, “he said Claudio Caprarulodirector of Analytics.

Inflation is one of the assumptions that the IMF will review and it affects the calculation of objectives. The organism on Monday acknowledged the impact of global prices on Argentina, but confirmed that “the goals have not changed.” The program predicts maximum inflation of 48%. It will be updated economically in the Budget which will be amended by decree.