In February of this year, food prices skyrocketed again, overheated the data of the Consumer Price Index and distancing the National Government from its desire that by April it has a 3% aheadas pointed out by the Minister of Economy, Sergio Massa.
According to private projections, inflation for the second month of the year would be above 6%, what it would take the interannual variation beyond 100%a figure that was already anticipated by the market.
With the CPI data for February at those levels, the Government’s goal of closing the year at 60% is a fantasyWell, of course, the private estimates for the first quarter of the year they are around 20%after the 6% of January ended with the fragile slowdown recorded in the last two months of 2022.
One by one: all the increases scheduled for March in the City of Buenos Aires
This being the case, the difficulty of curbing inflationary inertia is exposed with price controls in a context of accumulated imbalances. In the words of the capital foundation“once again it is demonstrated that a permanent moderation of inflation will require a comprehensive economic program”.
A first quarter with 20 points of inflation
With the aforementioned, the CPI for February is already played. For Fundación Capital, the data will give around 6% per month, consolidating an inflation floor similar to that of Januaryand, surpassing for the first time the 100% ceiling (101,1% i.a).
“Additionally, the month of March could set an even higher recordaround 6.5% monthly (100.9% yoy), in line with typical month increases associated with the beginning of the school year and the autumn/winter season in clothing and footwear. Furthermore, two thirds of the households will receive an update in the gas rate, between 40% and 50% depending on the household income (except for beneficiaries of the social rate who will not have increases), which would add half a point to the inflation record for the month”, maintains the report of the Capital Foundation.
And he adds: “Large users of businesses and industries will have increases of around 70%, which, although they will not directly impact the CPI, or they will do so indirectly through the higher costs that will be transferred to final prices. In turn, since March the monthly update of the Bus and train rates in the AMBA, which will be indexed to the result of the IPC-GBA with a two-month delay. In other words, the bus fare will rise and 6% in March (IPC-GBA for January), contributing 0.17 additional points”.
The document concludes that in this way, the first quarter of the year would close with inflation around 19.7 points, the highest inflation since 1991and entering a second quarter where the risks on the dynamics of prices “deepen”.
In the same vein, he expressed Santiago ManoukianHead of Research at Ecolatina, in statements to PERFIL pointed out: “For the first quarter we are projecting accumulated inflation in the area of 20%”.
The Government ratified the inflation goal of 30% for the first semester and asked to align parities
For his part, Maria Castiglionefrom C&T Consultores predicted for the first quarter and taking into account the 6.2% that was calculated by the consultant for February and the advance of March that was located at 6.9%. “Official inflation would give 20.3% for the first quarter of the year”.
The Liberty and Progress Foundry He also gave this medium a very close piece of information. After projecting on fFebruary an advance of 5.7% per month and for March an alarming 6.8%. From the consultancy led by the economist Aldo Abram estimate quarterly inflation of 19,6%.
The Liberty and Progress Foundry He also gave this medium a very close piece of information. After projecting on fFebruary an advance of 5.7% per month and for March an alarming 6.8%. From the consultancy led by the economist Aldo Abram estimate quarterly inflation of 19,6%.
Thus, the government’s goal of inflation around 60% year-on-year and 30% half-yearly seems unlikely. According to a report from Ecolatina the monthly variation of the CPI should be on average 3.8%.
The feeling of the market
“At this point in the game, the private assume between 5.5 and something more than 6% for February. The REM (January) yielded a median of 5.5%. If we take the most optimistic of 5.5% For the year to close at 60%, there must be an average of 4.06% from March to December. So it’s already very difficult”, he asserted Andres Reschinianalyst at F2 Financial Solutions, in statements to PROFILE.
“In this sense, the market discounts that 60% It will not be possible and you have in mind numbers that are more like 100%”, Reschini commented and added: “The fiscal deficit grew again in January, the issuance at 2/15 grew to 98%. The drought will be a huge blow and to top it off an election year. I don’t see too many chances of meeting the 60% target under these conditions,” he concluded.
LR
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