It was in the middle of last March on the fifth floor of the Palacio de Hacienda. Two important officials from the Ministry of Economy were analyzing the latest inflation number for February. They then mentioned the impact of meat, the macroeconomic situation and lamented regarding the “inertial overflows” of prices. They took this last argument to justify the “price trails” agreed between the Government and the companies. “The agreements have the concept of coordinating inflationary inertia,” they said regarding a phenomenon that is increasingly difficult to abate.
But that coordination has not yet managed to prevail. Products change in price very frequently. The remarks grow, beyond the weight of the variations that end up determining the monthly inflation. Argentina thus reaches a stage of semi-permanent indexation in many items and sectors of the economy.
In the run-up to the publication of the CPI for March, it will be known on Friday and it would be around 7%, those who carry out private price surveys saw an increase in the rate of redials in the first week of April.
The latest report from the LCG consulting firm warned that 49.5% of the basket it surveyed changed its price. This is the largest variation in the so-called diffusion index since it began to measure, in September 2021. LCG collects 8,000 products in eight supermarket chains. “There is more and more gymnastics to modify prices, which gives greater inertia to the inflationary process itself,” he explained to THE NATION Guido Lorenzo, director of the consultancy.
“Beyond having or not having a correct macro policy, the way in which the public acts must be changed. Changing the way people act is difficult,” added the economist regarding the enormous challenge ahead.
In Eco Go, which surveys 6,000 prices weekly in four supermarkets, they indicated that 59.5% of the products in the basket varied their prices from one week to the next in the first seven days of this month.. “It was a big increase. [del índice de difusión]”, they described in the Marina Dal Poggetto consultancy. They fell in price by 1.7%.
In the average of the last four weeks, according to Eco Go, the percentage of products that retouched their prices reached 73.2%. This is a more accurate number, as the first few weeks are still chart-raising windows. “Before, companies requested information to make pricing decisions once a month and 70% of the products did not increase when there was more or less 20% inflation. Now there are instances of price discussion every fortnight”, said a consultant who works every day with many mass consumption firms.
While the rate of remarks continues unabated, the weight of the increases grows. “Fourth and third of March gave higher than those of the previous month,” said the FAITHFUL. “In the first week [de abril], food and beverages rose 4.4%, with a strong increase in vegetables, but also meat and baked goods. That makes the total CPI for the first week once morest the first of March give you 7.4% ”, said Camilo Tiscornia, director of the consultancy C&T.
Inflation continues to be the main problem afflicting Argentines in all surveys and will be a fundamental vector in a year marked by presidential elections. A survey by D’Alessio Irol and Berensztein in March and released last week detected a deterioration compared to the last three months in the assessment of the current and future economic situation. In fact, support among ruling party voters fell 11 points in just one month. Inflation remains at the top of the list of issues of greatest concern. It grew almost ten points – from 83% to 92% – in one year and is a spearhead for all voters, no matter which party they have opted for in the last elections. They are followed by insecurity and crime, and economic uncertainty.
The rise in prices worries internally and externally. The International Monetary Fund (IMF) worsened its inflation outlook for this year and forecasts an 88% rise. This forecast is well below the estimate by private analysts in the Survey of Market Expectations (REM) released on Friday and which marked 110%. In front of Argentina, only Venezuela and Zimbabwe appear, according to the ranking prepared by the Monetary Fund.
President Alberto Fernández participated in an anti-inflation summit last week with the presidents of Mexico, Brazil, Chile, Cuba, Bolivia, Colombia, Honduras, Saint Vincent and the Grenadines, and Belize. “Fernández expressed the willingness of Argentina as a reliable supplier of quality food and technologies applied to agricultural-livestock production,” counted THE NATION so. I don’t know if it will be a good deal for those partners: The World Bank estimated that the country is the one with the highest food inflation (103%) behind Lebanon (261%) and Zimbabwe (137%). Lula will be able to give his friend better advice. Inflation in Brazil was 0.71% in March. In twelve months it is 4.65%.
In the country and in the run-up to the elections, the situation is heating up with the workers. The Moyano family was in charge of making it clear that the Government cannot control inflation. Pablo Moyano, who celebrated the income tax relief (not yet formalized) announced by Sergio Massa, said that there is “an inflation that the government cannot control”, that the truckers were the first to enforce the official programs with the controls on the supermarkets that generated controversy and asked to “be tougher” with the businessmen. “Fine them, shut them down, do something to them”, the leader of the CGT and the truckers’ union claimed the Executive.
The information that reaches Moyano is worrying. Workers’ inflation was 7.5% in March and the first quarter exceeded 20%. It is an indicator that is made under the supervision of a former minister of Alberto Fernández. “Today inflation causes employment growth with growth in poverty, which has not been seen since the 90s of the last century,” suggested the former head of the Education portfolio and general director of the Center for Concertation and Development ( CCD), Nicolás Trotta. Together with the UMET they prepare this indicator.
More vehement was another Moyano in television statements in recent days. In America, Facundo warned that this year there will be more than 100% inflation, he said that the whole world went through the war and the pandemic (disavowing the official argument) and that purchasing power has fallen five years ago. “Hitting Alberto doesn’t make sense; he hits himself and those of his own government hit him ”, sentenced. Then he told an infidelity: “I told my dad that with 5% of those who pass, we would already be on the street complaining.” On the other hand, Hugo, because of his father and the leader of the truckers in Argentina, -said Facundo- has a “sense of responsibility” and is not willing to “attack governance.”
