31.5% – Argentina records lowest annual inflation since 2017, says INDEC

Consumer prices rose 31.5 percent in Argentina last year, the lowest annual inflation rate since 2017, the INDEC national statistics bureau reported Tuesday.

Inflation last month was 2.8 percent, said INDEC, marking a slight acceleration from November and coming in above the expectations of private estimates. 

According to the Central Bank's latest Market Expectations Survey (REM), analyst and consultancy firms had forecast a December rate of 2.3 percent. 

Prices have now accelerated consistently each month since the 1.5 percent rate recorded in May. The worst month for consumers was March, when prices soared 3.7 percent.

The largest monthly increases in December were transport, up four percent, and housing, fuel and utilities, which jumped 3.4 percent.

At the other end of the scale, education rose 0.4 percent, with clothing and footwear up 1.1 percent for the month.

Regulated prices rose 3.3 percent with core inflation at three percent. Seasonal prices were up 0.6 percent.

The news confirms the dramatic slowing of price hikes under President Javier Milei, who took office in December 2023 vowing to slow what was then triple-digit inflation. In the La Libertad Avanza leader’s first month in office, consumer prices increased by more than 25 percent alone.

The 31.5 percent annual rate posted is the lowest since the 24.8 percent recorded in 2017 under ex-president Mauricio Macri.

According to the Central Bank survey, experts anticipate an annual inflation rate of 20.1 percent in 2026, with monthly increases expected to remain below two percent from February onwards. 

However, analysts say the market's focus is no longer solely on the specific monthly figure, but rather on how this data will impact the new exchange rate system controlling the exchange rate, interest rates and the Treasury's wider debt strategy in 2026.

Under new government rules, the peso’s exchange rate bands, within which the currency is allowed to trade against the dollar, adjust in line with inflation each month. 

– TIMES