Inflation continued to rise last month with consumer prices up 2.1 percent in September.
Prices have increased 22 percent in the first nine months of the year, according to the INDEC national statistics bureau, and by 31.8 percent over the last 12 months – a dramatic fall from the 211 percent recorded when President Javier Milei took office in December 2023.
According to INDEC’s report, the category recording the highest monthly increases in September was Housing, water, electricity, gas and other fuels, which rose 3.1 percent, driven mainly by increases in utility rates.
At the other end of the spectrum, restaurants and hotels showed the smallest variation, with an increase of just 1.1 percent, a figure that hints at a decline in consumption for the sector. Recreation and culture rose 1.3 percent.
The division with the greatest impact on regional monthly variations was food and non-alcoholic beverages, except in Patagonia, where transport saw the biggest hikes.
Regulated prices rose 2.6 percent, followed by seasonal prices (2.2 percent) and core inflation (1.9 percent).
Slowing inflation has been one of Milei’s biggest policy successes to date. While a gentle acceleration is not yet a sign for concern, prices have now accelerated since May.
Inflation slowed sharply in that month to a monthly 1.5 percent, but rose slightly in June (1.6 percent), July and August (both 1.9 percent).
Prices rose 2.2 percent last month in Buenos Aires City, up from 1.6 percent in August.
Most private analysts had anticipated a national figure above two percent for September, with similar monthly projections for the rest of the year. Clothing and footwear, transport and restaurants were highlighted as having risen the most.
The Central Bank’s monthly market expectations survey projected a 2.1 percent rise last month with a 2025 annual rate of around 30 percent.
This is the last official inflation update before this month’s midterm elections on October 26.
Milei has drastically reduced inflation since taking office, but the advance has come at the cost of a devaluation of the peso, massive cuts in government spending and the removal of subsidies that have made access to housing, healthcare and education more expensive.
Economist Hernán Letcher, of the Centro de Economía Política Argentina think tank, noted that INDEC’s measurement does not incorporate fully the weight of items like public services.
Letcher said the economic situation "is not very promising in terms of what people perceive on the street," since the sectors that are growing, such as mining and financial intermediation, are not the main drivers of employment.
Earlier Tuesday, the International Monetary Fund cut its 2025 growth projection for Argentina from 5.5 percent to 4.5 percent.
– TIMES/NA/AFP
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