Rising inflation has complicated Brazil’s Covid-19 crisis

Seven months after the lockdown, Michelle Marks received some unwanted news when she returned to work: when she raised the prices of almost all products used as hairdressers.

“A box of gloves has increased by 200 percent. Color products have grown at least 100 percent, “said the 37-year-old from Sওo Paulo, highlighting how his income is declining and expenses are rising.” I also had to increase the value of my services. “

It’s a dynamic going on across Brazil that has added an extra layer of complexity to the country Coronavirus crisisIt has already claimed the lives of about 350,000 people and pushed hospital services to the brink.

As Latin America’s largest economy shuts down Inflation is rising In parallel with the Kovid-1p epidemic, hunger fuels among the poorest citizens have reached record highs year after year.

“These things have disappeared from the tables of millions of Brazilians because of the high price of rice and beans, for example,” said Anna Maria Segal, a researcher at the Brazilian Research Network on Food and Nutrition Sovereignty, and safety. In the 12 months to March, rice prices rose 644 percent and black beans 51 percent.

“Inside Brazil Currently, food inflation has punished the poorest of the poor, deprived them of adequate access to food, and in many cases led to starvation, ”he said, adding that rising unemployment and declining social programs also contributed.

Volunteers deliver food at Snyder / Getty Images in Sao Paulo Alexandra

More than half of Brazil’s 212m people now have access to adequate food, with 19 million people, or 9 percent of its population, starving, according to a recent report by Segal Group.

“I’m doing some weird jobs, but it’s not enough for us to keep going,” said Jonathan, 26, who lost his job in the kitchen of a Chinese restaurant in Sao Paulo. He said he is now fighting to provide enough food for his three young children and his pregnant wife.

On a 12-month basis, inflation is expected to exceed 8 percent in June, much higher than previously estimated. In the 12 months from March, food prices jumped 18.5 percent, while prices of agricultural products in local currency exceeded 55 percent and Fuel consumption It has increased by about 92 percent.

Rice prices in Brazil have finally risen by a percentage line chart compared to the last 12 months shown

The improvements have already created a new challenge for President Zaire Bolsonaro Inside the fire To manage the Kovid-1p epidemic. Across Brazil’s largest city, graffiti has spread the label as the popular public leader “Bolsokaro” – a bearer of his name and the Portuguese word expensive.

Rising prices could provide useful ammunition to leftist former president Luiz In দাcio Lula da Silva, who Came back Balsonaro could be challenged in last month’s political battle and next year’s election.

“Bolsonaro is to blame for the rise in food prices, he is to blame for everything. They have to remove this man, ”said Maria Isabel de Jesus, a retired from Sওo Paulo.

Armando Castler, a researcher at the Brazilian Institute of Economics, said the government had also weakened inflation in terms of numbers and “how much it should be a matter of concern”.

He blamed rising prices for the devaluation of the Brazilian currency as part of stimulus packages passed by the US government – which helped strengthen the dollar and led to higher Treasury yields – and created a brighter economic outlook outside Latin America.

“You have a situation where commodity prices are rising because the global economy will grow a lot this year. Interest rates are rising and the dollar is strengthening as growth in the United States continues. This puts a lot of pressure on Brazil’s exchange rate and emerging markets in general, “he said.

Since the shock of inflation has intensified over the past month, Brazilian central bank Its core interest rate has risen 75 basis points, more than the half-percent expected by many economists. Further rate hikes are expected next month.

“The central bank has done the right thing, but it can’t stop there. It’s important not to be too light on this, “said Casella.

Sylvia Matos, co-ordinator of the Brazilian Institute of Economics, also pointed to Brazil’s weak currency as the reason for contributing to inflation. But he said Slide into real The declining public spending in Brazil has caused investors to worry.

After creating two separate stimulus packages to mitigate the effects of Covid-19, government debt has become about 90% of gross domestic product, a high level in an emerging market economy.

Its rollout This package is the second Starting this month, 45 million Brazilians set out to earn $ 50 a month for four months.

Critics say, however, that these stipends were not enough to feed people and keep them at home in lockdown.

“Emergency aid needs to be more valuable on an emergency basis so that people don’t leave their homes, but no one goes home hungry,” said Marcelo Freixo, a federal lawmaker for the PSL’s left-wing party.

“We need to reduce the spread of the disease. Brazil is already facing 4,000 deaths every day. We will reach 500,000 total deaths by the middle of the year. “

Matos said inflation hit poorer citizens harder than middle-class and wealthy Brazilians because a large portion of their income was devoted to food, whose prices have risen significantly.

“The only thing that can help right now is getting out of this epidemic.”

Coronavirus Business Update

How is the coronavirus taking it to the market, business and our daily lives and workplaces? Stay tuned with our coronavirus newsletter.

Register here

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *