This Friday, August 5, the National Administrative Department of Statistics (Dane) reported that in July 2022 the country reached a figure of inflation that has not been recorded since 2000.
(Read: Food, services and other sectors that drove inflation).
The Consumer Price Index (CPI) for the seventh month, in its annual variation, stood at 10.21%, that is,r, 6.24 percentage points more than that reported in the same month of the previous year, when it was 3.97%.
How does inflation affect households?
Since the country has recorded high levels of inflation, experts have spoken of the impact it has on the different social classes.
In the case of July 2022, the monthly variation of the CPI by income levels was 0.85% for the poor and the vulnerable, 0.81% for the middle class and 0.79% for those with high incomes.
Now, with respect to the year to date, the variation was 9.05% for poor households, 8.97% in the vulnerable, 8.08% in the middle class and 6.94% in those with high incomes.
And according to the annual variation of the CPI by income level, the impact was: pworks, 11.88%; vulnerable, 11.74%; middle class, 10.35%; high income, 8.75%.
Although the impact of inflation is generalized in the country, Jeisson Balaguera, CEO of Values AAA and professor at the EAN University, acknowledges that for the middle and lower classes it is more direct, since it affects the family basket and transport, which makes your income not enough.
“The upper class is also impacted, specifically, in interest rates“, he points out.
This is due to the fact that, in order to counteract inflation in the country, the Banco de la República has resorted to increasing rates. Trend that could be maintained, according to the expert.
Currently, rates are at 9%.
(Keep reading: Foods that rose, fell and stayed in price, according to the Dane).
“This causes the credits to increase their interest rates and make them more expensive. Normally, when there is high inflation and high interest rates, it is produced in an economic slowdown because there is less money in the market and less consumption.“, he points out.
Balaguera also states that this could affect the disposition of the minimum salary to 2023.
The expert indicates that with high inflation, this parameter would have to rise, which would increase the expenses of the companies and the costs of the products.
If the opposite occurs and the salary does not rise in line with inflation, then the purchasing power may be less for the citizenry.
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