Household consumption increases by 7.23% in August; ‘the poorer population still feels the effects of inflation

Gabriel Abreu – Cenarium Magazine

MANAUS – The Brazilian Association of Supermarkets (Abras) released on Thursday, 13, a survey showing that the consumption of Brazilian families in August increased by 7.23% compared to the same month of 2021. In the accumulated first eight months of the year, the high is 2.67% compared to the same period last year. But economists heard by the report point out that, despite the increase, low-income families feel the rise in food prices and inflation.

According to Abras, last month’s growth was driven by social benefits granted by the federal government as of August. In addition, there was also, according to the institutional and administrative vice-president of Abras, Marcio Milan, to Agência Brasil, the impact of the reduction of unemployment and inflation, with the exoneration of energy and fuel prices. “We have been observing employability: employment has been growing and unemployment has been falling”, said the institutional and administrative vice-president of Abras, Marcio Milan, to Agência Brasil.

Abras revised its projection for growth in household consumption this year from 2.8% to a growth of 3% to 3.3%. “The reflection of the aid, which started in August, the drop in prices, which became more accentuated in September, shows that our projection is certainly on the way to reach 3% or 3.3%”, emphasized Milan.

Inflation

The basket of the 35 most consumed products in supermarkets dropped 1.71% in September, compared to August, costing R$ 745.03 in large urban centers like São Paulo and Rio de Janeiro. However, in comparison with September 2021, when the set of products cost R$ 675.73, the basket had an increase of 8.76%.

Economist Orígenes Martins explained that Brazil lives a different scenario from other rich countries in the world. The National Wide Consumer Price Index (IPCA) registered deflation for the third consecutive month, something that had not been seen in the country for 24 years. In September, the IPCA, considered the country’s official inflation rate, was -0.29%, as released by the Brazilian Institute of Geography and Statistics (IBGE).

“Logically, when you have lower inflation, you have income increasing because of lower unemployment, which is what is happening in Brazil. The possibility of having an increase in consumption, as was presented by the Brazilian Association, this possibility is even greater and this is what is happening in Brazil, and the most important of all is that we realize that only economic advantages are occurring in the country, contrary to what happens in the rest of the world. We have countries such as the United States, the United Kingdom, Germany, France and Italy presenting results that are exactly the opposite of what is happening in our country”, explained the economist.

Prices are still high

The economist Inaldo Seixas evaluated the data released by Abras and how they reflect for the needy population, since they are the ones who most feel the high prices of food in supermarkets.

“The reflection for the needy population is always more complicated. The still high food prices, even though you have the increase, with the arrival of the Brazil Aid and other social benefits, such as the FGTS and also the retirees’ INSS advances, you had an increase in the availability of income in the economy and that this ended up in the hands of some consumers allied to this. A decrease in electricity and fuel prices, creates a better consumer expectation for the coming months. We also know that this reflection in the increase of confidence is an average of all segments of the population”, evaluated Seixas.

Basic Food Basket in Manaus

In August, the Consumer Defense Commission of the Amazonas Legislative Assembly (CDC/Aleam) reported that the Basic Food Basket reached the value of R$ 333.82. The survey indicated the price increase in cassava flour (+26.01%), chocolate milk (+20.12%), chicken (+19.63%), cooking salt (+15.91%) and butter (+8.48%).

For economist Denisse Kassama, the basic food basket is more expensive than last year. “The natural tendency is for values to fall, as the economic scenario consolidates, but it depends on the “sloppyness” of the federal government”, said Kassama.

Lower value

Also according to the CDC/Aleam research, the lowest value of the Amazon Basic Food Basket was verified in January 2022, when it reached the value of R$ 277.33. In July, the survey of the basket reached R$ 332.78.