As Americans continue to see a relief in prices Every month, Argentines have to face an inflation that seems to have no control, since in February it exceeded 100 percent.
Inflation in the United States eased again in February and stood at 6 percent annually, its lowest level for a year and a half.
(Also read: What does it mean that inflation has exceeded 100% in Argentina?)
The data is known in a context of difficulties for the Federal Reserve (Fed), which is under pressure due to the bankruptcy of the Silicon Valley Bank and two other entities before their monetary policy meeting next week to define how much they will affect their interest rates.
Inflation of 6 percent is in line with what was expected by analysts, and is lower than the 6.4 percent in January 2023, according to the Consumer Price Index (CPI) published by the Bureau of Labor Statistics. .
In the month-over-month comparison, the price increase was 0.4 percentalso in line with analysts’ expectations, after a rebound in January this year.
The explosion changed as expected, but core inflation was higher than expected
Despite this being the smallest year-over-year increase since September 2021, inflation still remains well above the Fed’s long-term target of 2 percent. Furthermore, This is the eighth consecutive month of data dropfrom a peak of 9.1 percent a year in June of last year.
“Inflation increased the expected variation, but underlying inflation (which measures the rise in consumer prices, minus those of food and energythe most volatile) was higher than expected,” said Rubeela Farooqi, chief economist at HFE.
In the monthly comparison, this tougher inflation data showed an upward price variation of 0.5 percent compared to 0.4 percent between December and January. In one year, however, it moderated to 5.5 percent, its lowest level since December 2021.
(Also read: Superfinanciera rules out effects on the economy of bankruptcy in the US.)
The housing costs They were the ones that contributed the most to the increase in inflation, representing more than 70 percent of the increase. Food, leisure and purchases of household equipment also contribute to the rise in prices.
Meanwhile, the price of eggswhose shot became symbolic during this period of rise in the family basket, fell 6.7 percent compared to last January.
While the price of energy, which has been triggered by the war in Ukraine since last March, continues to fall, 0.6 percent compared to January. However, in one year they are 5.2 percent more expensive.
The Fed has waged a campaign of aggression to rein in runaway inflation, raising interest rates eight times since the beginning of last year to cool the economy and moderate demand.
For President Joe Biden, “the challenges” in the banking sector show that there will be “setbacks” on the path to “durable and stable growth.”
Unstoppable inflation in Argentina
Contrary to what happens in the United States, inflation in Argentina seems to have no ceiling. In February it increased 6.6 percent compared to the data for January and reached 102.5 percent per yearas reported by the National Institute of Statistics and Censuses (Indec).
It is one of the largest records in the world, although the phenomenon is chronic after almost 50 years of strong increases in the cost of living in Argentina. In the first two months of the year, the rise in consumer prices reached 13.1 percent.
The general level of retail prices exceeds 100 percent this year, according to the latest survey of expectations released by the Central Bank, based on reports from the largest banks and private economic consultancies in the country.
The government of President Alberto Fernández had estimated, in the 2023 national budget, a much lower annual rate of 60 percent.
What contributed the most to the rise in inflation were the prices of food and non-alcoholic beverageswhich increased 9.8 percent, mainly due to the incidence of the increase in meat and dairy products.
The Minister of Economy, Sergio Massa, renewed in February a voluntary agreement of “fair prices” with supermarkets and food, hygiene, clothing, telephone, education and other items companies, to de-index the economy, with expected increases of 3.2 percent. monthly cent until June on about 2,000 products.
(Also read: How the millionaire Colombian businessman saved the fortune of Silicon Valley Bank)
Relative calm in the markets
There was a change of mood, at least in the short term,
in relation to the vulnerability of the banking system
The bag of NY ended yesterday higher thanks to purchases of shares at a good price, in a market less anxious than on Monday due to the turmoil in the banking sector, after learning of the bankruptcy of Silicon Valley Bank.
The Dow Jones gained 1.06 percent, the tech-heavy Nasdaq 2.14 percent and the broad S&P 500 index 1.68 percent.
This Tuesday “there was a change of mind, at least in the short term, in relation to the vulnerability of the banking system“, Featured Steve Sosnick of Interactive Brokers.
The Paris Stock Exchange joined the recovery of the markets and the CAC-40 rose 1.86 percent. Meanwhile, Frankfurt closed yesterday with a rise of 1.83 percent, after inflation in the United States and the bank recovery after the fear of contagion after the failure of Silicon Valley Bank subsided.
With information from AFP and EFE
