Tuesday, 23 February 2021 18:57

Digestyc reports El Salvador recorded negative inflation in 2020

Written by Cindy Moreno

An investigative work of the General Directorate of Statistics and Census revealed that the behavior of the Consumer Price Index (IPC) regarding November 2020, which was of a monthly variation of 0.20%. It is mainly explained by the increases of 0.42% in Housing, water, electricity, gas and other fuels and 0.75% in Furniture, Household Items and Ordinary Household Maintenance.

The monthly behavior of prices from December 2018 to December 2020 shows in this last month an increase in prices. This rise is mainly due to the increase in prices in housing rent, propane gas, furniture and household accessories, which directly impacted the IPC, highlights the document.

In December 2020, positive price variations in nine divisions drove monthly inflation upwards, with housing, water, electricity, gas and other Fuels standing out with 0.42% and furniture, household and household maintenance Items with 0.75%, due to the increase in prices of housing rental, propane gas, furniture and household accessories, according to the official report.

Another data highlighted by Digestyc is that the average cost of the basic food basket (CBA) in the urban area in El Salvador remained above $202 in 2020, the highest value in the last 19 years.

The institution, a division of the Ministry of Economy (Minec), records the monthly cost of the basic urban and rural food basket, an indicator used to measure extreme and relative poverty in countries, as it identifies the economic capacity of households to buy the food necessary to carry out an activity.

The CBA is the minimum calorie intake necessary to perform a job and in El Salvador the price of the daily ration per person is calculated to obtain the monthly cost. It is elaborated from the value of French bread, tortillas, rice, meats, fats, fruits, vegetables, milk, among other foods.

Updated data in 2020 indicate that the annual average urban CBA was $202.59, the highest value in the Digestyc record dating back to 2001. This figure is also $2.59 (up 1.29%) higher than that recorded in 2019, at $200.

Digestyc data confirms that 2020 was the second consecutive year in which the cost of the basic basket remained above $200.

The value of the urban CBA started 2020 above $200, but suffered a sharp increase in May and June to reach $211.44. At that time, fruit and vegetable traders in La Tiendona, the largest supply center in El Salvador, warned of increases of up to 30% due to difficulties in importing after the reduction of agricultural labor in Guatemala and Honduras for fear of contagion.

Digestyc statistics show increases in the ration of bread, tortillas, fluid milk, beans, and vegetables. Meat, eggs, rice, sugar and fruits showed slight decreases or remained the same.
 
The increase in the cost of food raised the alarm that more salvadoran families would fall into poverty, since the highest increases were observed during the confinement implemented from March to August, which forced to paralyze 80% of the economy, including the informal sector that lives on daily income.
 
In September the cost began to show decreases and in December it closed at $198.14, the second lowest price in all of 2020. Digestyc documented that the value for the last month of last year was down $2.4 against the $200.54 paid in November.
 
The average coaction cost (propane gas) increased last year, going from $1.78 in 2019 to have a value of $1.81 in 2020. This product is imported by El Salvador.
 
The average cost of the basic rural food basket stood at $144.95 in 2020, $0.56 lower than the average of $144.39 reported in 2019.
 
As in the urban region, food in rural areas became more expensive between May and June, but then began to fall in the last months of the year. December ended with the lowest cost in 2020.
Last modified on Tuesday, 23 February 2021 19:02