In March, the Minister of Economy Luis Caputo announced that inflation is expected to be close to 10%, marking the third consecutive decline in the index. This downward trend began in December at 25.5%, dropping to 20.6% in January and further decreasing to 13.2% in February. The Treasury Palace is pleased with the slowdown in food inflation compared to other items, which raises the possibility of reaching the desired single-digit inflation rate this month.
According to EcoGo, the recession in March has overridden seasonality, with overall inflation at 12.5%. Although March typically sees higher inflation than February, this time it did not follow that pattern. Preliminary data for April also supports the government’s expectations, with a weekly inflation rate of 0.4% for food prices, indicating a continued moderation in price increases. The survey by LCG shows that food and beverage inflation has been on a downward trend for the past few weeks.
Economists project that April will likely see single-digit inflation, with a continued decrease in food prices contributing to this trend. However, consumption remains low, with retail sales decreasing significantly in March compared to the same period last year. Food sales have also seen a substantial drop, indicating changing consumer behavior in response to economic conditions. Despite these challenges, economists predict that inflation will continue to decrease in the coming months, particularly in core inflation and wholesale markets.
