Argentina’s inflation edged up last month on winter holidays

Argentina’s monthly inflation edged up in July, snapping three months of slower readings, in a slight setback for President Javier Milei. 

Consumer prices rose 2.1 percent last month compared with June, just above the two-percent median estimate of economists surveyed by Bloomberg. Monthly inflation had slowed below the two percent mark for the first time in 10 months in June. 

From a year ago, inflation picked up marginally to 33.8 percent from 33.5 percent, higher than expected, according to data published Thursday by the INDEC statistics agency.

Inflation in Buenos Aires City came in higher than expected last week, at 2.9 percent, as people took their winter vacations in the Southern Hemisphere, raising national inflation expectations among some economists. The World Cup also contributed to higher airplane ticket prices.

Culture and recreation had the biggest increase within the national consumer price index, with a five percent hike, while restaurants and hotels increased 2.8 percent. Core inflation came in at 1.8 percent.

Ahead of Thursday’s inflation report, Economy Minister Luis Caputo announced that companies without earnings in dollars will now be able to borrow greenbacks, a measure to put to use idle dollars now at record levels.

The move is meant to incentivise economic activity, which has been struggling to gain traction especially among the most job-heavy sectors.

“July is a seasonally high month,” Caputo said just ahead of the inflation print. “It’s a matter of time until inflation converges to international levels.”

Caputo described Argentina’s disinflation process since Milei came to office as “phenomenal.”

Economists surveyed by the Central Bank in July forecast a 2026 year-end inflation rate of 29.8 percent, down from 30 percent in the previous survey, combined with growth of 2.7 percent, down from a three percent forecast in June.