Sergio Massa is looking for support consumption, an indicator that is showing signs of weakness every month, with a package of measures that foresees an increase in the credit card financing limit so that consumers have a wider spending margin.
At the same time, it launched a 9 percentage point drop in Ahora 12 program fares, which it went from 82.45% to 72.75%. At the same time, a reduction in the cost of financing for the payment of the credit card summary was announced, which was set at 80%.
Although the goal is a recovery in sales, analysts warn that with purchasing power decimated the margin to achieve a consistent recovery in consumption is low and could play against the official intention to stop the escalation of prices.
For the economist Camilo Tiscornia, of the consultancy company C&T, “this measure aims to encourage consumption, which goes completely against the goal of lowering inflation“.
Tiscornia specifies that “on the one hand they raise the interest rate for deposits, but on the other they lower it for Now 12 loans. They are contradictory measures.”
For Tiscornia, “promoting consumption is not the way to control inflation”.
“I don’t know if it’s prudent to allow general increases in the purchase limit. Perhaps there are people who are already at their maximum borrowing capacity, and freely increasing limits exacerbates the situation“, Tiscornia slips.
For the economist Andrés Borenstein, “the measure can help in a certain segment. Perhaps it will help so that consumption does not fall so much. In many cases the limits have arrived late and then this makes them coincide with inflation”.
As for the price, Borenstein sees no problem. “I don’t think it overheats anything. Today’s inflation is not a problem of the consumer boom. The expectation of inflation is what generates a reduction in the demand for money.”
Hernán Letcher, director of Argentina’s Center for Political Economy, has a different view. “The indicators do not take into account a drop in consumption. When you look at the evolution of VAT and supermarket sales, you don’t see a significant drop.”
“What you notice is the impact of inflation on consumption. When you want to consume with paper and you have a low limit, the same daily increase in the price makes that figure exceeded. This measure helps to support consumption, because the cap serves as a limitation,” he said in statements to Radio Nacional.
“It seems reasonable to me that the limits are adapted to the current situation of the Argentine macro. In general, banks tend to have a certain level of arbitrariness about the limit they give you and that is related to customer sustainability and ability to pay,” Letcher said.
AQ
Source: Clarin
