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Inflation: January closes at close to 6% and the increase in meat puts pressure on February


The hacienda rose 30% and that increase would be transferred to the counters, with a full impact next month.

On Tuesday, February 14, INDEC will announce inflation for January, which, according to consultants,

will show a rise from 5.5 to 6%


This level shows an acceleration with respect to the previous month and has already begun to worry the Government, which hastened negotiations with companies to stop the rises by betting on price agreements.

As if that were not enough,

in February another "fuel" element was added to the fire of prices: the increase in meat,

a very important item in the Food and Beverage category that

explains 23%

of the Consumer Price Index ( CPI).

It happens that the price of meat -which had been losing ground against inflation in the last seven months- hit

a 30% jump in the Treasury market

and that suggests -sooner rather than later-

a reflection of that rise on the counters from the butchers.

The extent of this impact will depend on the ability to transfer to demand, analysts explain.

But, in principle,

"for every 10% increase in the price of meat, the CPI rises

approximately 0.6 percentage points," explains Sebastián Menescaldi, an economist from the consultancy Eco Go.

In his view, the impact on retail prices only began to be seen in the last few hours, which

will be felt in February inflation.

“Clearly, the increase in meat that corresponds to the second half of January is going to have a partial impact on inflation this month.

The effect on the counter will surely be felt more in February”, agreed Hernán Lechter, CEPA economist.

An indicator on the behavior of food week by week can be seen in the measurement of prices in supermarkets carried out by the LCG consultancy.

Last Friday, the indicator showed an average rise of

5% in the last four weeks

and 5.5% measured end to end.

According to its analysts, "average inflation

accelerated for the fifth consecutive week and reached the highest value in nine weeks."

Meanwhile, in the Eco Go surveys in terms of food corresponding to the third week of the month, a variation of 1.7% was detected compared to the previous week.

"With this data and considering a weekly variation projection of 1% for the last week of the month, inflation for food consumed at home in January would climb

to 4.9% per month,"

he said in his latest report.

With which,

the inflation data for January would be located at 5.6%, 0.2 points above what was expected the previous week


"This is mainly due to a slightly higher-than-estimated food record," warned the consultant.

During January, in addition to food, other regulated products boosted the general indicator, such as

 prepaid (6.5%), fuel (2%) and gas, electricity and water rates (14.1%, 19.6% and 20.1%, respectively), domestic service (6.5%) and bus and train fares in AMBA (between 20% and 70%

depending on the service), among others.

From the Analytica consultancy, they see inflation of 5.8% for January, mainly explained by the increase in regulated prices.

And others, such as those of the Libertad y Progreso Foundation, forecast a rise of 6.3%.

The latest Survey of Market Expectations (REM) carried out by the Central Bank forecast 5.6% for January and an acceleration for the following months: 5.7% in February, a peak of 6.2% in March and 6 % for April.

The scenario calls into question the fulfillment of the objectives set by the Massista management: to lower inflation by one point every two months and

reach April with a 3rd ahead. 

The slowdown was seen in November and December at a level of 5%, but in January it was cut.

For this reason, February and March should be around 4% in order to reach the desired 3% in April,


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Source: clarin

All business articles on 2023-01-28

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