Argentina again recorded the second highest inflation in Latin America in March

Argentina again recorded the second highest inflation in Latin America in March, with a monthly rate higher than that of all the major countries in the region.

When the National Institute of Statistics and Censuses (Indec) confirms on Thursday 15th the variation in average consumer prices of last month, inflation will have exceeded 11% during the first three months of the year. Private Consultants they estimate it ended around 4%, although the final number could be up, with a similar trend in April.

It’s 4% it was only exceeded by the 9.1% recorded in Venezuela, according to the Observatory of Finances of this country, which is going through a situation of chronic hyperinflation. In the past 12 months it has reached 3687% according to IVF and the projects of the International Monetary Fund (IMF) which it will complete at 5,500% by the end of the year.

Brazil recorded a rate of 1.04% last month and 6.2% in the past 12 months. Analysts participating in the Latinfocus project that it will end with a 4% price hike. In Mexico it was 0.8% in March and 4.6% last year, while 3.7% are forecast for the end of the year.

In Uruguay, it rose to 0.6% in March and 3.1% in 12 months; it is estimated that it will end the year at 7.3%; for Peru, it was 0.7% in March and 2.6% in 12 months; would end at 2% in December, while these figures in the case of Paraguay this was a slight deflation of -0.1%, 2.04% and 3%, respectively.

In the case of Ecuador, last month’s record hit 0.18%, with deflation of 0.8% in 12 months and a projection for this year of 0.9 percent; at Bolivia, the figures were respectively -0.1%, 1.1% and 2.2%.

At the same time, in Chile, it reached 0.4% in March, 2.9% in one year and would end at 3.1% this year., while in Colombia the previous data was 0.5% and 1.5% in 12 months; it is estimated to drop to 2.7% next December.

With these numbers, Argentina will once again end another year in a comfortable second place after Venezuela in the region and a place in the top 10, as in recent years.

Signs for April

According to the Eco Go study which directs Marina Dal Poggetto, “So far this year, the price dynamics have been decoupled from the rate of devaluation; while prices increased by 11.9% over the year the exchange rate has evolved by 10.2% and is slowing down within the margin (2.3% in March) marking a clear path for the appreciation of the real exchange rate ”.

“So far this year, the price dynamics are decoupled from the devaluation rate” (Dal Poggetto)

“Beyond the anchoring of rates and the decision to slow down at the rate of the ramp, prices remain long due to the leakage of the exchange rate differential, the impact of import restrictions and mainly due to authorized increases in regulated items such as prepaid, telephony and fuels, increases that we seek to concentrate on the first months of the year ”.

“The program, in effect since last March, has since presented two price adjustments: both between 4% and 9%, one in July and the last in October. The impact of the price liberalization of frozen products on the index is undeniable, but keeping them frozen is not sustainable in a context where cost dynamics are on the rise, ”the report says.

And he adds the consulting firm’s analysis: “Right now, cushioning inflation increases future inflation. Despite the controls, food inflation remains high, driven by uncontrolled foods (fresh products), meats, fruits and vegetables, as well as by products withdrawn from maximum prices ”.

Eco Go estimated headline inflation to be 4.2% last month, 11.9% since January and 39.7% in 12 months. As for the food and drink item, it reached 4.3 in March and 48.8% last year, according to this measure.

In the first week of April, according to Eco Go, the increase in food and drink was 2.1%, with an “acceleration of 1.5% of the margin and an increase of 4.2% compared to the first week of March”. The report warns that “in the short term, prices remain long as the central bank aims to slow the devaluation rate to 1.5% per month, at the same time as projected monthly inflation hovers around 3.5. %. to 4 percent ”.

“Administered increases in regulated articles put upward pressure on prices, thus postponing a slowdown in the nominality of the economy and complicating the price targets for the coming months, ”Eco Go underlined.

For its part, Guido Lorenzo, The LCG director said his pricing survey finished in March above 4% and that in April, it peaks at 3.5%, “a floor that seems difficult to drill” for the next few months.

“April is at 3.5%”, a floor that seems difficult to drill “for the next few months” (Lorenzo)

In the case of food prices, LCG recorded a rise of 1.3% in the first week of this month. “The Food and Beverage Index has shown an average monthly inflation of 4.6% over the past 4 weeks and 5% measured end-to-end over the same weeks. These price levels leave a 3.6% trail for the remainder of April, ”LCG reported.

For these reasons, for Camilo Tiscornia inflation will end this year at 44.5%, although other consultants estimate it will reach 46%, very far from the official guideline of 29% set by the Ministry of the Economy in the budget for the current year.

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