For the government, inflation in July will be 2.2%, lower than market expectations

For the government, inflation in July will be about 2.2%, a level lower than the percentage predicted by private economists in the latest market expectations survey (MER) released by the Central Bank (RACO). This is a variation that, if confirmed next week with the release of the Indec Consumer Price Index (CPI) – after the STEP -, would be the lowest of the three months. year.

Official sources said
THE NATION last month's price increase would show a deceleration from 2.7% in June and confirm once again the trend since April of a slowdown in price increases. According to these same sources, it would come close to about 2.2%, although the gap could even be a minor tenth (2.1%).

If this were confirmed, this number of inflation could have an impact on some BCRA policy definitions. "The Monetary Policy Committee (Copom) of the Central Bank has decided to keep the minimum rate of liquidity letters (Leliq) at 58% until the next inflation figure is known", said the entity that drove Guido Sandleris late last month. The IPC will be known Thursday of next week.

To find a month with a variation similar to that expected by the government for July, it should go back to May 2018, times when the impact of the exchange rate has not yet been suffered, when price index indicated an advance of 2, 1%

July was a month of stable exchange rates and did not result in higher public service rates. However, peer closures have begun to be noticed in a context in which companies do not have much space to continue to compress their margins.

However, the information on the price change for this month is known after the financial calm began to fade in August with the nearness of the OSP and the changing climate of global markets due to the tension between the United States. and China

The latest consumer price index in June showed a positive change of 2.7% and a cumulative increase of 22.4% for the year. At the same time, the 12-month inflation rate was 55.8%. This last measure showed its first deceleration after six months, according to official data.

Last week, Indec estimated that the May wage increase had not yet beaten this month's inflation, except for the income of registered private segments. However, this official measure does not include data on informal workers updated to the month of the survey, according to the methodology.

Moreover, the official programs to improve the pocket of the middle clbad (12 currently at 0% rate or the ANSES subsidized car and credit compensation scheme, among other official anabolic elections) are just beginning. to be implemented since June.

According to the July MER, specialists estimate that July's inflation would have been 2.4% on a monthly basis (one-tenth less than the previous survey). "For the second half of the year, they are expecting a 2.1% drop in monthly inflation in November, with a slight rise to 2.2% in December 2019, remaining at this level in January 2020. ", did he declare.

For the year, private consultants participating in the EMN estimated the overall inflation rate at 40% (unchanged from the previous survey) and at 41.4% that for the core component (one tenth less compared to the REM in June).