Tuesday, December 7

Wholesale inflation was 2.8% in October (below the CPI)

“The opposite happened in ‘Primary products’, where the index presented a deceleration with respect to the month of September (it went from 3.4% to 2.8%). On the other hand, within ‘Manufactured and electric energy’, the sub-heading ‘Electric energy’ presented a strong acceleration with a rate of variation of prices of 9.2%, while ‘Manufactured products’ presented a variation of 2.8 % ”, They analyzed from the ACM consultancy.

“Within the category of ‘Manufactured Products’ a considerable volatility of the index can be observed both due to the heterogeneity in the recovery, as well as due to the considerable basket of regulated prices and import restrictions”, they pointed out from ACM, adding: “In this way, we observe ‘Tobacco’, which presented a very marginal variation with respect to September (1%). Along the same lines, it is possible to observe the evolution of ‘Refined petroleum products’ (0.6%) associated with the local price, which would be around 30% behind the international price and would be pulling down the index ”.

“For 17 months (June 2020) the Wholesale Price Index has been at values ​​above 2% per month, marking an average increase of 3.8%”, analyzed the consulting firm LCG.

What’s coming

As it is a rise that was around the average levels that the CPI has been exhibiting, they point out that the wholesale inflation figure would not necessarily put extra pressure on retail prices. Although, of course, it would not allow a very marked slowdown either.

“The October data was around the average speed we have of retail inflation, beyond the fact that in some months due to seasonal factors the CPI rises or falls a little more. And 2.8% is in line with what we see that everything is going up. In fact, in November we see that, as there is a little less pressure due to seasonal issues, it is likely that retail inflation will be closer to 3% ”, Lorenzo Sigaut Gravina, an economist at the Equilibra consultancy, analyzed Ámbito, who added: “In other words, I don’t see that the data adds additional pressure, it is in line with what has been seen. It would have been different, for example, if there is a much higher (or lower) data in wholesaler than in retail. But it was more or less in line with what the CPI has been and that is why I do not see greater pressure. Beyond that, obviously, it will not help lower retail inflation either. “

“I don’t see that there is pressure on the IPC. In fact, the wholesale price index is slowing year-on-year, while the retail price index is holding up. That is because in retail prices many services are going up (prepaid, restaurants and trips), and what goes up in goods very strongly is textiles “, said economist Jorge Neyro, who stressed:” What I see is that the dollar is moderating the rise in wholesale prices, something that has less impact on retail prices because there are many services ”.

“We expect the wholesale price index to be affected by the end of the year by a greater expected devaluation of the official exchange rate, added to an increase in international prices, which will have an effect on the evolution of imported goods prices. Therefore, in the fourth quarter, an acceleration of the monthly growth rate is expected (from 2.5% in the third quarter to 3.7% in the fourth) ”, they analyzed from LCG.


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