President Mauricio Macri has already warned that inflation in March – which today will be disseminated by Indec – will be “a peak”. Among economists who measure the rise in the cost of living estimate that it will be higher than January and somewhat higher than February, but will be below other months with higher rise, such as September and October 2018.
Four economists consulted estimate that the cost of living rose from 3.7% to 4.1% in March. For a consultant (Orlando Ferreres & Asociados), it could even be somewhat lower than in February, when the Indec registered a variation of 3.8%.
The president assumes that the inflationary “peak” will be a turning point to “move forward and eradicate it”. The president insisted that overcoming permanent rises in the cost of living is “more difficult” than he supposed and pointed to “cultural behaviors that cost to eradicate.”
Federico Furiase (Eco Go), Gabriel Caamaño Gómez (Consultancy Ledesma) coincide in forecasting a 4% inflation for March. Fausto Spotorno, of Orlando Ferreres, places it at 3.8%, while Santiago Gambaro (of Analytica) estimates a rise of 4.1%.
“March was a month where there was an overheating of the dollar, and an increase in tariffs, that impacts food and regulated services”, defines Furiase.
The estimate of OJF, of 3.7%, is based on “an acceleration of prices in its growth rhythm in the month of March, driven by both food and regulated goods, in particular, the items that registered the highest The increases were Education and Food and Beverages, which registered a variation of 8% and 4%, respectively “.
His report emphasizes that other items also left their mark. This is the case of transportation and communications, with a 5.1% increase, affected by the increase in public transport and cell phones. Clothing (4.7%) and Housing (3.8%) complete the causes. In the latter, there is an increase of 14% in the electricity tariff in Buenos Aires.
“We expect a 4.1% rise in the CPI for March, due to the strong rise in the core component (the exchange rate rose 12% in one month) as the regulated one.” In the case of regulated increases, in March those of electricity, transportation, cigarettes, fuels, telephony and schools “, explains Santiago Gambaro, from Analytica.
Core inflation accumulates 49.2% annually, according to OJ & F and the general rate is 51.5%.
In the neighborhood of 4%, the number is high, but the Macrist administration has already passed worse months: September and October 2018, with measurements of 6.5% and 5.4% respectively.
Furiase anticipates that April will be around 3.8%. “The increase in food left a significant drag, which also hit naphthas, gas, which was now unfolded, and subway,” he says. The economist believes that the inflationary slowdown may come from June, and is from the stabilization of the dollar against the peso.
Economists agree that there is already a high floor for April. Analytica figures it at 4% and that of construction at 4.3% for regulated products, 2.4% for seasonal products and 3.5% for regulated products. “The next months will also be affected by the schedule of rate increases, which is concentrated in the first half of the year”, they complete.
Furiase makes a complete radiography, where he links dollar, inflation, country risk and elections. In its scenario, the June decline will be consummated “as long as the dollars of the harvest, of the Treasury sales and the high interest rates manage to sustain the exchange stability of the last weeks”. “And there is the political noise due to the electoral uncertainty, which is taking its toll on country risk,” he says.
“If the country risk continues to escalate due to political uncertainty, it will be difficult to maintain the exchange rate stability, which requires a deceleration of inflation as of June,” he predicts.