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Inflation: Caputo meets with supermarkets amid a price acceleration at the start of March - Infobae
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Inflación: Caputo se reúne con los supermercados en medio de una aceleración de precios en el arranque de marzo
El martes se conocerá el IPC de febrero. Los primeros datos privados muestran un ritmo más rápido de remarcaciones en la primera semana de este mes
www.infobae.com
March 11, 2024
By Mariano Boettner
Caputo met the mass consumption industry on Wednesday and this Monday he will do so with the supermarkets
In the midst of an acceleration in prices in the first week of March, something that was detected by private measurements, the Minister of Economy Luis Caputo summoned the large supermarket chains to a meeting for this Monday afternoon , days after a meeting which he held with CEOs of mass consumption firms . The head of the Treasury Palace will explain his vision of the economic plan and will demand the “presentation” of the consumer prices that appear on the shelves, an issue that he addressed privately with businessmen and that he later raised on social networks. For now, this Tuesday the CPI for February will be known, which is expected to be close to 15 percent.
Caputo returned from Punta Cana (Dominican Republic) after participating until Saturday in the meeting of the Inter-American Development Bank (IDB) , one of the regional financial entities with the largest investment portfolio towards Argentina. Caputo's trip occurred while a new round of negotiations began in the Casa Rosada with the governors to push a new omnibus law in exchange for fiscal relief to the provincial coffers. On the island, Caputo met with authorities from the IDB, which authorized a loan of USD 400 million for food assistance, and from the United States Department of the Treasury.
On the local front, a meeting with executives from large shopping centers awaits Caputo this Monday. Official sources reported that the meeting at the Palacio de Hacienda, which will take place in the afternoon, will aim to “dialogue about the evolution of the macroeconomy” , something similar to what was proposed before the broad table last Wednesday with executive directors. of mass consumption brands. The Minister of Economy will explain this Monday, just like last week, the next steps of his economic plan. He assured businessmen that there is no sudden devaluation on the horizon , which possibly appears to the market as one of the biggest unknowns about the roadmap of Javier Milei 's Government .
In essence, there is a concern in the economic team about the pace of price marking on the shelves and how they are presented to the consumer in supermarkets. It had first emerged as one of the topics in conversation with mass consumption companies last week and was then expressed directly by Caputo in his X account .
The Government discussed with companies how consumer prices are presented on shelves. EFE
The head of the Treasury Palace said that there was “coincidence that prices are going to continue falling and that it is important to make the real price per unit of the products transparent so that they can be appropriately captured by Indec ,” he stated. Hours later he posted a video of the shelves of a pharmacy chain in which posters with promotions, discounts and bonuses could be seen under each product.
“It happened to many companies that they priced their products expecting a catastrophe scenario that did not materialize. Today they have very high list prices that people mostly do not validate , and they have already started to lower them, but via promotions, such as '60 pct discount on the second unit' or even '2x1',” he noted. “These discounts, although they are not captured by Indec due to its logical unit measurement modality, are a clear sign of inflationary deceleration ,” he concluded.
The supermarkets understand that this issue will appear at the meeting but they assure that these types of promotions and discounts are not the responsibility of the chains but of the industry. “ They are ideas from the supplier companies . When we tell them that those products are not going to sell with the list prices they send us, they suggest selling them with promotions. But lower prices, they don't lower them ,” a supermarket businessman who will be at the Palacio de Hacienda this Monday assured Infobae . “ Sales are collapsing ,” he warned.
The latest Indec report, with data as of December, showed a year-on-year drop of 6.6% and 4.6% compared to the previous month. This last number may be influenced by a behavior observed by supermarkets: consumers tried to anticipate as many purchases as possible in November by assuming that there would be a devaluation the following month, as happened.
At that meeting there had been representatives of leading firms such as Las Tres Niñas, Molinos Río de la Plata, Molinos Cañuelas, Quickfood, Establecimiento Las Marías, Procter & Gamble, Johnson & Johnson, Arcor, Mondelez, Mastellone, Loreal, Danone, Unilever, Compañía Industrial Brewery, Coca Cola, Nestlé and Quilmes.
After his trip to Punta Cana for the IDB meeting, Caputo will meet with supermarkets. REUTERS
The minister highlighted to businessmen the slowdown in inflation due to the “ordering of public accounts” and the “improvement in the Central Bank's balance sheet.” In addition, they reviewed the latest measures promoted by Lavigne to deregulate foreign and domestic trade and eliminate the controls used by the previous Government. For now, La Libertad Avanza hopes that the “certainty” about the future of the macro will avoid a new escalation in shelf prices, that is, that there is no “hedging” process.
Among the main deregulations are the non-renewal of the Fair Prices program, the repeal of the Supply, Gondolas and Price Observatory laws , the termination of trusts, and the repeal of information regimes. There is a consensus among companies that all these legislations implied higher costs and less competitiveness.
The first private price measurement numbers in the first week of March show an acceleration . The price index prepared by the Latin American Economic Research Foundation (FIEL) showed its largest weekly increase since the beginning of the year, with a rebound of 5.7% in the last 7 days . “In the first week of March, inflation in the City of Buenos Aires, measured by the CPI-FIEL, was 5.7% for the week, 15% compared to the first week of February and 304.7% compared to a year ago,” the report indicated.
Meanwhile, LCG recorded an increase of 3.6% in food and beverages , a jump similar to that of the second week of January, which later eased. “The average monthly inflation and the measure between peaks accelerated again, reaching 12%,” indicated LCG. In particular, the private consulting firm explained that the largest increases in the last week were recorded in meat (3.6%), dairy products and eggs (2.3%) and beverages consumed within the home (1.8%).
