Due to inertia, tariffs and the dollar, September inflation will still be above 6%

Of inertia in August, the rises of rates and the rise of dollarthe inflation September could close above 6%. This is a rate below the 7.4% peak reached in July, but still at very high levels, which continue to reflect the difficulties in containing the rise in prices, its impact on food and income.

In that line, EcoGO expects a 6.3% increase this month due to the resistance of August inflation (whose official data will be known next Wednesday, but consultants already estimate between 6 and 7%), as well as increases in regulated goods and services. The calculation is in line with the projection of food consumed at home in September, of 6.3%.

According to the consultant, after three weeks above 1.5%, in early September the prices of Food and beverages they increased by 1%, the lowest value since the first week of July. In the past four weeks, the values ​​of this item have increased by 6.1%. It is one of the factors acting as a “support” for the prices this month.

Among the foods that increased the most in the first week of September were eggs (10%), fish (5%) and potatoes (4.1%). Meanwhile, meat slows down: it went from 1.8% the previous week to 1.2%. Fruit and vegetables fell (the latter grew by 0.7%, but the former fell by 1.1%), while dairy products and eggs increased due to the jump of the latter.

On the regulated side, this month increased the subway (40%), taxis (30%), cigarettes (5%), expenses (between 6 and 8%), schools in Buenos Aires (9%) ), the domestic service (9%) and gas (10.4%) and electricity (14.9%). The government last week launched the subsidy segmentationwith increases that could reach up to 140% and add one point to inflation in 2022.

Analysts also pay attention to the rise in the official dollar and parities. “We expect inflation of 6% in September. It slows the core, from 6.6% to 5.7%, but hits the largest peg for crawling (pace of devaluation of the peso or rise in the official dollar), some wage inertia (planned adjustments) and the expected rate hike, “said Ricardo Delgado, president of Analytica.

The Central Bank has accelerated the wholesale dollar so that it is not far behind inflation and rates. “Inflation could be around 6.5%, it is a projection, but there is an increase in energy rates, and several relevant regulations, the official exchange rate indicates a depreciation rate of 6%, as well as the salaries “, said Lorenzo Sigaut Gravina, partner of Equilibra.

Since the crisis that began in June and ended with the departure of two economy ministers and the arrival of Sergio Massa, inflation has accelerated at the rate of the rise in parallel dollars (blue came to trade at $ 350), an exchange gap of up to 150% and a brake on sales due to lack of prices. Prices have risen 71% in 12 months and expectations have exceeded 90% annually.

Inflation would moderate in August, in a scenario in which the new minister put a brake on monetary issuance, a sharp rise in rates and a $ 128 trillion cut in spending. Now, facing September, economists are closely following core inflation, the one that excludes changes related to the situation or time of year.

“In August we measured core inflation of 6.1% and general inflation of 6.7%, but the core interests me for September because it is the trend. Eliminating tariffs, regulated prices and very volatile ones, such as tomatoes, you have prices rising at an average rate of 6%. And with price increases and prepayments, it’s possible it closes above 6.5%, “said Fausto Spotorno, of Orlando Ferreres.

Meanwhile, LCG expects a slight slowdown in September, with inflation ranging between 5.5% and 6% per month.