Lower consumption already has an impact on low-income households

The level of consumption of low-income households was abruptly halted in April and May, according to a study by consumer consulting firm Kantar Worldpanel.

In 2017, consumption was already down. At the general level, it had dropped by 1% in the year, although 17% of the poorest households (clbadified as "lowest" by the consultant) had recovered by 3% after the brutal shock of the year 2016. [19659002] In the first quarter of 2018, consumption in these households increased at a slower pace of 1%. But in April and May, inflation and loss of income led to a reduction in consumption of these population groups, down 2%.

"The improvements in late 2017 and early 2018 have been liquefied," says Federico Filipponi, According to the consultant, mbad market basket prices have gone from an annual variation of 17% to 21%, eroding enormously the power of purchase and real wages, which was decisive for the decline in household consumption

The government is trying to correct this fierce blow with one hand, which gives the # 39 other, the most "vulnerable" sectors that he claims to protect. Thus, payment facilities and quotas are reactivated, but in their increasingly degraded versions. In the province of Buenos Aires, the province bank for example at 50% discount promotion for purchases in supermarkets (favoring the friendly businessmen who notice the most prices), but on one condition: it will only be for products in the basic basket. ] You might be interested in: Fixes to adjust: Now extend 12 to lower consumption

"For low-income households, mbad consumption is the main expense since they allocate 57% of their income, this way price behavior is central to understanding the evolution, when they accelerate very quickly they have to adjust, "Filipponi explains.

The adjustment reaches households: they buy less things

in the face of adverse conditions, households have reduced the size of their purchases, stopped visiting large areas such as hypermarkets or wholesalers, and returned to the nearest point of sale in their neighborhood: warehouses and at least According to the Indec, this is corroborated by the decline in sales at the supermarket. In April, purchases at these establishments fell 2.1% year-over-year

The consultant estimates that on average, at each point-of-sale visit, they earned 4% less in each category: "The size of purchases it has not declined over the past three years, not even in 2016, and it's a strong sign of the impact of the unfavorable context of recent months, where households are forced to reduce the amount bought to cope with price increases "

In terms of sectors, the main adjustment of the last two months has been made in drinks – especially among people without alcohol -" It is necessary to consider that drinks are the group of categories that these households buy more frequently, "says the report.

Overall, April is a month of" cleavage ", there is a before and after. Economic activity is strongly contracted with a decline 2.7% monthly Not only do trading prices mark this month's climate, but an accumulation of imbalances and the deterioration of the purchasing power of workers who have begun to manifest themselves before.