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Argentina's inflation tripled that of Venezuela last year - Infobae
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La inflación de la Argentina triplicó a la de Venezuela el último año
Se conoció el índice privado de precio del país que gobierna Maduro, que exhibió una suba sensiblemente menor al de las consultoras argentinas, tanto el mes pasado como en los últimos 12 meses; el efecto del atraso cambiario sobre los 2 países
www.infobae.com
April 08, 2024
The private price index of the country governed by Maduro was known, which showed a significantly lower increase than that of Argentine consulting firms, both last month and in the last 12 months; the effect of the exchange rate delay on the 2 countries
By Martin Kanenguiser
Argentina's inflation tripled that of Venezuela last year REUTERS/Agustin Marcarian
In March, Argentina once again registered the highest inflation in Latin America, tripling in annual terms and quadrupling in monthly terms the price increase registered in Venezuela.
The Venezuelan Finance Observatory (OVF), the think tank that disseminates credible figures from the country governed by Nicolás Maduro , stated that “in March, the inflation rate stood at 3.9%, higher than last month when prices they fell on average 0.5%.”
In addition, he stated that “the accumulated and annualized inflation rates were 7.8% and 89%, respectively.” For its part, the Venezuelan Central Bank reported a price increase of 1.2% last month, 4.1% in the first quarter and 67.7% in the last year.
In the case of Argentina, the statistics of private consulting firms were between 11 and 13 percent for last month and around 285 and 300 percent for the last 12 months, depending on the methodology used.
Tomorrow the price index of the City of Buenos Aires will be known and on Friday that of Indec at the national level. Minister Luis Caputo affirmed that inflation “is already running at single digits,” since the Government analyzes the increase in prices without seasonal adjustments.
Regarding Venezuela, it was specified that “in Caracas the inflation rate was 2.2%” and it was indicated that “from the point of view of the components of the price index, food increased 4.8%, transportation 4 .6%, communications 4.2% and home equipment 4%.”
In this way, “the rise in food prices explains 18% of the general increase in prices.”
“This acceleration of inflation occurred in a context where monetary liquidity expanded 18.2% in the month and 215% in annualized terms and despite the stability shown by the exchange rate, which increased 0.36% in March and 29% compared to March 2023″, indicated the OVF.
File photograph in which a man's left hand was recorded holding a wad of bolivars of different denominations, under a dollar bill, in San Cristóbal (Táchira, Venezuela). EFE/Johnny Parra
“Clearly the exchange rate policy, with particular emphasis on 2024, aims to stabilize the exchange rate and has been able to do so. However, it must be taken into consideration that such a policy faces very important risks when local inflation does not decrease quickly and significantly,” the report warned.
Thus, “when taking into account the real exchange rate, that is, the nominal exchange rate adjusted by domestic and international inflation differentials, the problem is apparent.”
In this way, "while in March the annualized international inflation rate was around 3.5%, prices in Venezuela rose 89%."
“This means that locally produced goods are more expensive compared to imported ones, a situation that reduces the economy's competitive capacity, while compressing aggregate demand and economic growth,” the Observatory explained.
“Sooner or later the delay in the exchange rate will have to be corrected, as has always happened in Venezuela and in all economies when the exchange rate is not sustainable,” he warned, in a reference that many analysts also made about Argentina. This is because the official exchange rate slides to 2% monthly while inflation rises two digits per month and reduces the competitiveness gained with the devaluation of last December.
Prices in Argentina
On the other hand, the consulting firms marked an average of 13% for last month. In particular, the survey of S&T retail prices “for the GBA region presented a monthly increase of 12.7%, lower than the 16.3% in February and the 15% that INDEC had released for the region. The twelve-month variation was 295.3%.”“Core inflation was lower than total inflation, 10.9%, due to the strong presence of seasonal and regulated increases,” stated the report from the consulting firm run by María Castiglioni and Camilo Tiscornia.
“Throughout the month, price increases were losing momentum, lowering total inflation for the fourth week of the month to 10.7% and core inflation to 8.8%,” he highlighted.
March inflation Econviews
In particular, they reported that “Education was the area with the greatest increase due to the increase in schools before the start of classes, a common seasonal behavior; Housing followed, influenced by the increase in electricity that started in mid-February and, therefore, also had an impact in March.”
For its part, “Salud moved in a similar way, mainly due to a new adjustment in prepaid payments. The medications replicated February's behavior. And the Miscellaneous Goods and Services category was driven by the higher price of cigarettes. In toiletries and beauty items, a moderation was seen compared to February.”
Meanwhile, “Food and beverages increased 10.8%, somewhat less than in February, with marked moderations in the vast majority of components. "Much of the behavior of the sector was influenced by a strong rise in vegetables."
“In transportation and communications there was a significant slowdown because there was no increase in public transportation like the one that had been registered in February,” he explained.
For its part, Econometrica indicated that last month's inflation was 11.5% and food inflation was 9.6%.
In addition, he estimated that it will reach 168% for this year, compared to the average of 210% calculated by the majority of the consulting firms consulted by the Central Bank in the Survey of Market Expectations (REM).
On the other hand, the Market Survey published by the OVF indicates 62% in Venezuela for next December.
For ECO GO, inflation last month was 13.1%, 54.4% in the first quarter and 303.6% last year. The items that increased the most in the last 12 months, according to the study directed by Marina Dal Poggetto , were food with 342%, Health 334% and Education 321%.
According to Econviews, the increase in food prices in the first week of April was 0.8% and inflation would end at 10% monthly and 297% annually.
President Javier Milei believes that inflation will continue on its downward path, although he considered that we must be patient due to the relative price adjustment that is still pending.
