Citizens' Purchasing Power Takes a Nose Dive Under President Pena Nieto
Rising inflation has greatly eroded Mexicans’ purchasing power in recent years (Juan Uribe)
The increase in gasoline prices will trigger inflation as predicted by the Central Bank of Mexico (Banxico), and although the government of President Enrique Peña Nieto has announced an increase to the minimum wage, this will not be enough.
The purchasing power of Mexicans has decreased by 11.1% during the tenure of the Peña Nieto government according to data on the minimum wage, inflation, and price indexes collected by the Center for Multidisciplinary Analysis of the National Autonomous University of Mexico (UNAM).
Price indexes in Mexico reveal that at the end of 2016 the essential food items basket, which estimates a food budget for a family of four, had a cost of 218.06 pesos per day (USD $10.90), indicating that a worker at minimum wage can only afford 33% of this budget.
The situation was very different in 2013 when Peña Nieto took office with the minimum wage at 64.76 pesos per day (USD $3.25) and the essential food items basket was estimated to cost 171.86 pesos per day (USD $8.60).
Since 1987 the income of Mexican families has increased to 1,129% in correspondence with the minimum wage; however due to inflation, purchasing power has actually declined over the last 30 years.
During those 30 years the essential food items basket has increased in cost by an astounding 5,800%.
Read the rest at PanAm Post | Español
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