While inflation is increasing at an accelerating pace around the world, El Salvador has managed to slow its inflation between the months of March and April. It has even improved a position among the nations in the area in terms of inflation rates.
Salvadoran yoy inflation rose from 6,7% to 6,5% from month to month, as can be seen in the Central American Monetary Council (SECMCA) comparison of both months' reports. These data come from the central banks of Central American countries, as well as the Panama Institute of Statistics and Census.
According to these data, no other country in the region managed to lower its inflation rate at that time, although there were two remaining at levels below those of El Salvador: Guatemala and Panama, with respectively 4,6% and 3,7%. April.
This places El Salvador as the third economy with the lowest year-on-year inflation rate in Central America for the month of April. The country moved up one place to overtake Costa Rica, which ranked third in March and experienced a steep fallout from inflation in April.
President Nayib Bukele tweeted that an opposition media in his country (El Mundo) echoed the news. In this regard, he cataloged the event as a sign that the Salvadoran response to a worldwide phenomenon is "better than many have claimed".
Indeed, criticism of Bukele abounds in the press and among local economists. Particularly economically and with greater emphasis since the adoption of bitcoin as legal tender a few months ago.
"Bitcoin has become part of the problem"
Economists such as Ricardo Castaneda, coordinator of the study center of the Central American Institute for Tax Studies (ICEFI) for El Salvador and Honduras, are part of this trend that calls into question the adoption of bitcoin.
Quoted by First Report, Castaneda assured that although the country's financial problems were not caused by the adoption of bitcoin, the cryptocurrency aggravated them. "Bitcoin is no longer a solution and has become part of the problem," the economist said.
Of course, bitcoin's decline from last year's all-time highs (at this time over 50% off the quotation of $ 69.000) influenced the country's investments in cryptocurrency.
As we previously reported, Bukele's bitcoin wallet is suffering quite high unrealized losses. However, it cannot be considered a loss until those bitcoins are reported as being sold below their purchase price.
Furthermore, criticism of bitcoin adoption has come from all sides, regardless of how the cryptocurrency is performing on the market. The International Monetary Fund and other institutions attacked the Salvadoran government's measure, although the latter remained firm in its commitment.