President Javier Milei received a boost Wednesday when the INDEC national statistics bureau reported that consumer prices in Argentina rose 1.9 percent last month, slightly lower than anticipated.
Inflation in the eighth month of the year stayed below the crucial two-percent threshold, said the bureau.
That was slightly better than most forecasts, which predicted a rate of between two and 2.2 percent. The monthly REM market expectations survey, tracked by the Central Bank, anticipated 2.1 percent.
Some analysts, however, saw an acceleration, pointing to higher food prices and the weakness of the peso against the dollar.
To date, prices in Argentina this year have risen 19.5 percent. Inflation over the last 12 months is 33.6 percent – a stark fall from the triple-digit figures seen when Milei took office in December 2023.
Transport (3.6 percent) was the category that recorded the highest increases in August, followed by alcoholic drinks and tobacco (3.5 percent) and restaurants and hotels (3.4 percent).
Housing, education, goods and services all registered above-average increases.
At the other end of the scale, clothing and footwear prices fell 0.3 percent.
Regulated prices rose 2.7 percent in August, with core inflation of two percent. Services jumped 2.5 percent, while goods only 1.6 percent.
Earlier this week, the Buenos Aires City government reported that inflation in the capital slowed to 1.6 percent last month – a drop of 0.9 points from July.
Most analysts and consultancy firms believe that inflation will stabilise for the rest of the year, remaining between 1.5 percent and two percent a month.
President Javier Milei thanked Economy Minister Luis Caputo for the monthly figure, writing on social media that the positive indicator came “in the context of a month of extreme volatility in the demand for money.”
Inflation is a chronic problem in Argentina, but in 2021, price increases spiralled out of control. In 2023, the year Milei took office, annual inflation was 211 percent.
The Milei government managed to slow price hikes to almost 118 percent in 2024 and has maintained the downward trend in 2025.
Caputo celebrated in X that, “for the first time since November 2017, there were four consecutive months of inflation below two percent per month.”
But consumption has plummeted and not everyone feels that their daily reality has improved.
“Products and services are increasing above the price index reflected by Indec, and my salary is always below the inflation rate, so every month I lose purchasing power,” complained Matías Schmukler, a 28-year-old architect, on the streets of Buenos Aires.
– TIMES/NA/PERFIL
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