Tuesday , October 19 2021

They warn that private consumption will fall again in 2019



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Private consumption will fall again this year by 1.4% year-on-year, slightly below the 1.5% yielded in 2018, according to official sources.

However, analysts considered that there would be different dynamics and changes of tendencies within this fall. In this sense, they unleashed that, unlike previous years, when the backlog changed, the easing of the commercial regime and the reduction of taxes on some products encouraged an expansion of consumption in durable goods, "the Weight depreciation and the high cost of financing will reverse the cost of this type of property. "

They added that "unlike previous years, when mass consumption was the variable that was adjusted in a context of lower available income, due to the increase in rates and expansion of durable goods, we estimate that this is the least consumed consumer component this year ".

"This responds to the fact that household spending on these goods is less sensitive to changes in income and / or prices, while it is not vitally important to acquire a new vehicle or to change household appliances, items who will feel the crisis more, "they have argued.

As a result, they estimate a drop of 1% year-on-year on mass consumption, a decline lower than that of the total of private consumption, which would begin to show positive year-on-year variations as of the third quarter, "when the purchasing power of wages improves partial compared to 2018 ".

In this sense, to the extent that a triumph of the official or a market-friendly candidate is expected, they will allow an incipient recovery of consumption in the second half, leaving seated the bases for a better 2020 ".

The study has stated that "the income available for consumption will not grow, as the main factor behind inflation will be the rise in utility tariffs and other difficult-to-avoidable expenses such as formal education, prepaid and fuels, which will even average an increase of 5% monthly between February and April next ".

As a result of this "a part no less than the expense of families will suffer a higher price adjustment than the general level, and given the difficulty of replacing the consumption of public services, it will tend to reduce spending on others goods and services ".

That is, "even though wage increases exceed inflation, the same will be determined by factors that will not allow a clear increase in the available income, so that one of the main engines of consumption will remain weak," according to has informed Télam.

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