Monday, July 22, 2024

ECONOMY | 08-01-2024 16:26

High figure expected for INDEC December inflation announcement

National statistics bureau set to post December inflation rate, with private consultancy firms expecting it to clear 20% and President Javier Milei hoping for 30%.

The INDEC National Statistics Bureau will reveal Argentina's 2023 inflation rate on Thursday, with most private estimates expecting the annual figure to surpass 200 percent.

INDEC's consumer price index (CPI) is expected to be between 20 and 30 percent for December, though President Javier Milei cautioned this week that it could be worse.

According to the libertarian, Argentina was "set up for 45 percent" and if it comes in at 30 percent of lower for the final month of last year, it would be a "great number."


The official figure, set to be published on Thursday by INDEC, will be a big leap from the 12.8 percent average price rise registered in November 2023 in the final days of the Alberto Fernández administration. 

The subsequent devaluation of the peso, with the official exchange rate now closer to 800 pesos per greenback, and the removal of price controls on selected items led to large hikes across nearly all sectors of the economy.

Public transport fares, tolls and underground fares, along with significant rises by private health insurance firms, have led increases while food and goods have also soared.

Milei, who took office on December 10, said that the figure was the responsibility of the previous government.

“Let me be clear: they are responsible. I did what I had to do: send a very orthodox shock adjustment programme," he said, defending the decisions in office.

“If we look at the first and second week of December, it placed the inflationary dynamic at a monthly 45 percent, if you see a 30 figure, it’s a great number," he said, adding that Economy Minister Luis Caputo should be celebrated.

The last month of 2023 featured a cohabitation of two administrations: Fernández's Frente de Todos government and the La Libertawd Avanza administration since December 10.

Argentina has not seen a cumulative annual inflation rate of more than 200 percent since the hyperinflation registered in the early 1990s.


According to most consultancy firms, the figure for December will be between 20 and 25 percent. 

“The rise in the CPI in December is explained by the release of prices which were artificially delayed. This is something that had helped show a lower CPI in previous months, which was unsustainable,” read a recent report from the Libertad y Progreso Foundation, which reported a 29-percent rise for last month and a cumulative 219-percent increase.

In the meantime, Eco Go forecast 29.4 percent and finished 2023 with 222.8-percent inflation, by explaining that the end of price agreements “was coupled with the devaluation and the seasonal dynamic itself” in December.

They also specified that foods and beverages registered a 34-percent rise.

Presidential Spokesman Manuel Adorni anticipated that inflation in December will be around 30 percent in his daily press conference on Monday, which the government deems an auspicious result.



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