As the new year approaches, there is a growing sense of optimism among the population about the future of their economy. According to recent data, retail sales have been steadily increasing, with several factors contributing to this trend.

One explanation for this is the “prevention” mindset of consumers, who are wary of inflation and the possibility of a new devaluation. As a result, they are spending their pesos on essential goods and services rather than saving or investing them. This has led to an increase in demand for consumer goods, particularly those that are perceived as offering good value for money.

Another factor driving retail sales is what analysts call the “substitution” effect. With many people unable to travel or purchase homes due to economic uncertainty, they are instead directing their resources towards other areas such as appliances or home improvement projects. This has resulted in increased demand for certain products and services, leading to higher prices and increased sales volumes.

Despite these positive indicators, there are concerns that consumer behavior may change in response to changing economic conditions. For example, with Javier Milei’s election as President and rising inflation starting in December, economists predict that consumers will need to adjust their budgets even further in order to maintain their purchasing power. This could lead to a decline in spending on non-essential items such as luxury goods or entertainment services.

By Editor

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