:quality(85)//cloudfront-us-east-1.images.arcpublishing.com/infobae/2MUETOLMJZDUXBBDD4JLGWMD3A.jpg "Inflation in January, around 6%, will leave a high floor for the first quarter")
The government will announce inflation data for January today and it will be worse than expected. Far from consolidating a slowing trend, which had already been interrupted in December but for barely two tenths, the INDEC is now reporting a figure for January that is about 1 point higher than the previous month. Impacted by increases in regulated prices but also by food, where the sharp rise in meat prices had a decisive impact, last month’s CPI was around 6%. This data puts an end to the economic team’s attempts to generate inflation expectations around 4% towards March as the Minister of Economy, Sergio Massa, imposed, and leaves a high floor for the whole of the first quarter. .
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In this sense, projections among local analysts who participate in the Central Bank (REM) Expectations Survey showed an average guideline of 5.6% for the CPI in January. This is the case, for example, of Econviews, which coincided with the average. According to Isaías Marini, an economist at the consultancy, “Inflation in January was mainly driven by increases in regulated prices. In this sense, the highest impact came from the Housing, Electricity, Gas and Other Fuels division, due to the increase in electricity, gas and water tariffs in AMBA,” said he indicated. The adjustment of public transport fares in the metropolitan area – by far the region that weighs the most in the index – and the rise in fuel, prepaid and telecommunications also had an impact on the index.
Going forward, February and March present an overloaded challenge and analysts begin to ignore that the monthly records will again be presented “with a 6 ahead”.
In January, consumers paid 250% more for fruits, vegetables and livestock products than producers demanded.
This is what emerges from the Origin and Destination Price Index (IPOD) of the Argentine Chamber of Medium Enterprises. The margins between the gate and the gondola, by sector and by product
The Libertad y Progreso Foundation estimated inflation at 6.3% for the last month and “for February, inflationary dynamics will continue to be above 5% per month, which would lead to the crossing of the annual barrier of 100% in the general CPI”, they confirmed by the entity.
The consulting firm C&T Asesores Económicos agrees with the January estimate, which attributed the seasonal jump in tourism and the increase in food and non-alcoholic beverages a decisive weight in the indicator, since they would have increased at a higher rate than in December, about 5.3 percent.
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Meanwhile, worker inflation, carried out by the Metropolitan University for Education and Labor (UMET) and the Center for Consultation and Development (CCD), stood at 5.5%, reaching 98 % over the last twelve months, the highest mark since 1991. The rise, according to the university, was driven by “seasonal products such as tourism, fruits and vegetables, accelerating by 0.2 points of percentage compared to the 5.3 recorded in December”.
Ecolatina, meanwhile, expects a value of 5.5% due to momentum in food and regulated services. While EcoGo projected 5.6% while Analytica measured 5.8% for January.
With this scenario, Commerce Secretary Matías Tombolini has already acknowledged that there was an acceleration in January given by “the seasonality and the weight of the services category these months due to tourism and leisure” .
The official, who just wrapped up the fair price renewal with maximum increases of 3.2%, admitted, however, that price controls would not reduce inflation. according, but that the objective is to “close the fiscal gap and the monetary financing of the deficit, issue less and accumulate reserves” and that price programs are complementary tools that cannot exist in a vacuum. “It’s a price program that tries to influence inflation expectations.”
Also the Secretary of Industry, José Ignacio de Mendiguren, admitted that inflation will be “higher than in December”.
“People buy the same, with prices that should not be validated. And that didn’t help us. There were also ‘seasonal issues’ in the first month of the year,” the official explained.
“This happens, among other things, because during the season there has been a movement of tourism and price abuse, the limit is often set by people’s purchasing power,” he said. For his part, the new head of presidential advisers, Antonio Aracre, already predicted that not only in January but also in February “drought and the change in livestock retention logic played a trick, impacting the increase in meat”. He also acknowledged that in March, with the start of the school year, there will be facilities and school supplies, so it will be difficult to achieve the 3.8% promised by Minister Massa, but he stressed that in April there is “every chance of reaching this level.
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