Despite a barrage of government measures to tamp down inflation, consumer prices in Argentina rose 3.5 percent in September, faster than anticipated, the INDEC national statistics bureau revealed Thursday.
Official data now shows that prices have risen 37 percent in the first nine months of the year – higher than in the entirety of last year and one of the highest rates in the world. Year-on-year, inflation now totals 52.5 percent.
Worryingly, INDEC’s data also shows that price rises are accelerating after a run of six monthly declines. In August, inflation was a full point lower, on 2.5 percent, the same as the previous month. Before that inflation had been on a consistent decline (March, 4.8 percent; April, 4.1 percent; May, 3.3 percent; June, 3.3 percent; July, 3.2 percent; August, 2.5 percent).
September’s advance was led by clothing and footwear, up six percent, followed by alcoholic beverages and tobacco (the latter in particular), which rose 5.9 percent, and health, up 4.3 percent. Restaurants (4.1 percent), recreation and culture (3.8 percent) and transportation (three percent) also recorded notable highs.
Rising food and non-alcoholic beverage prices will also raise an eyebrow in the Casa Rosada, rising 2.9 percent against 1.5 percent the previous month. The Economy Ministry said that was mainly driven by increases in fruits and vegetables (with squash up 30 percent, among others), adding in a statement that “the rest of the products had lower increases.”
Strong adjustments were also seen in sugar, sweets, chocolate, coffee, tea, yerba and cocoa, as well as milk, dairy products, and eggs.
The largest increases were registered in Greater Buenos Aires (up 3.8 percent in September), with the lowest in the northeast of the country (up 2.8 percent).
Argentina has suffered two decades of sky-high inflation. Already in recession since 2018, the coronavirus pandemic plunged the country into an even worse economic crisis, with GDP slumping by 9.9 percent in 2020, when prices rose 36.1 percent.
On Thursday, the government said it had reached an agreement with the private sector to freeze prices on more than 1,200 goods in a bid to slow inflation. The agreement relates mainly to food and cleaning products.
President Alberto Fernández’s government projects that prices will rise 33 percent next year.
The Peronist leader, who has two years to run on his term, is under pressure with partial legislative elections due next month.
Fernandez runs the risk of losing his Frente de Todos coalition's majority in the Senate, which would be a major blow given that he does not have a majority in the lower house chamber of deputies.