Food prices continue to hit the pockets of Central Americans

Food prices continue to hit the pockets of Central Americans

The buyer of the region has decreased the volume of purchases, with the exception of Salvadorans, this due to the high prices of some foods in the basic basket, according to an analysis by Kantar, an expert firm on consumer behavior.

By Gabriela Melara – strategicandbusiness.net

Did you stop buying some products or presentations that were previously common in your home due to rising prices? The increase in prices suffered by Central American countries causes some families to think twice about including or not including some products in their shopping basket.

According to a Kantar analysis, there are three trends that mark buyer behavior today, one of them is the decrease in purchase volume.

Another is the change of brands due to price and the last is that, although their visits to supermarkets have increased, they choose fewer categories and make a lower outlay due to the increase in prices.

Inflation remains high

The price increase trend has remained almost constant since January and the picture does not seem to change, inflation in Central American countries increased again in August 2022.

Governor: The Fed must raise its rates at least until the beginning of 2023

The only country where a decrease in inflation was reported as of the eighth month of 2022 was Honduras, where it fell slightly but still stands at 10.4%. The countries with the highest index in the region are Costa Rica, where it has already exceeded 12%, and Nicaragua, which placed the index at 12.15%.

The most recent data from the National Institute of Statistics and Censuses (INEC) of Costa Rica reveal that the Consumer Price Index (CPI) reached 12.13% (year-on-year) in August, giving way to the highest inflation recorded in the last 10 years.

The transportation segment, followed by food and beverages, meals away from home and clothing, were the ones that had the most effect on the increase in prices last month.

For its part, in El Salvador, inflation increased for the fifth time in the year and reached 7.66%. The Central Reserve Bank (BCR) explained that the value of food rose 0.31 points more than in the last month and stands at 14.50%.

For Guatemala, the CPI for August reflects that year-on-year inflation stood at 8.87%.

According to historical data from the National Institute of Statistics (INE), once again the indicator is the second highest for 14 years when it stood at 9.4% in December 2008.

The average cost of the Basic Food Basket (CBA) was estimated at Q3,454.98 (about US$444.03), for an increase of Q85.29 (US$10.96) compared to July.

Of interest: The yen hits its lowest level against the dollar since 1998

Nicaragua registered an interannual inflation -in August 2022- of 12.15%, higher than the 4.98% registered twelve months ago. On the other hand, monthly inflation was 0.86% for August 2022.

Panama, to July, the annual variation of the index increased by 3.5%.

Breaking point?

The Central Bank of Honduras (BCH) indicated that the slight drop in the CPI for August is the first drop after 26 months of consecutive increases.

The entity highlighted in its report that this may represent “a possible breaking point, associated with alleviating external inflationary pressures and monetary policy actions to reduce excess liquidity.”

The institution’s report indicates that the sectors that registered a negative behavior in August are transport (-0.32%) and accommodation, water, electricity, gas and other fuels (-0.03%).

FAO reports drop in food prices

Likewise, the Food and Agriculture Organization of the United Nations (FAO) indicated that world food prices continued to fall for the fifth consecutive month in August, with vegetable oils even below their level of a year ago.

Can read: FAO: World food prices continue to fall in August

In August, it registered a new decrease, more moderate, of 1.9% in one month.

The vegetable oil price index fell by 3.3% in August, “reaching a level slightly below that of August 2021”.