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Consumer prices in Argentina accelerated again in October, growing 88% year-on-year, the highest rate in the last three decades, despite the fact that the government froze the prices of more than 1,700 products last week.
Annual inflation reached 88% last October in Argentina, the highest figure in the last three decades, as reported on Tuesday by the National Institute of Statistics and Censuses, INDEC, while detailing that the monthly inflation rate for October was 6.3%, compared to the previous month, surpassing the rate of 6.2% registered in September and completing four months of increases above 6%.
“In October, the rise in the food item had a strong impact again, which was well above average,” said Eugenio Marí, chief economist at the Libertad y Progreso Foundation.
The annual inflation data represents an advance of five percentage points with respect to the variation registered last September. This is the strongest increase since November 1991 when it was 91.3%. At that time, Argentina was trying to leave behind the hyperinflation of 1989-1990.
INDEC reported that in the first ten months of the year Argentina accumulated inflation of 76.6%. “Argentina is an almost unique case in the world of the 21st century, with inflation that is not only high and growing, but also persists for almost two decades,” Marí observed.
Argentina and the International Monetary Fund corrected the inflation projection for 2022 upwards, to a range of 90-100%, and that of 2023, to 55-65%, but the private forecasts received by the Central Bank place it at 100 % and in 2023 of 90%.
“We hope that November and December will register inflation rates above 6%, with which the year would close with inflation of 105%,” Marí pointed out, while adding that “however, it must be said that the levels of economic vulnerability are very high and that any negative shock could sharply accelerate these rates”.
On Friday, the government of Alberto Fernández launched a new agreement with manufacturers of basic consumer products and supermarkets to keep the prices of 1,700 products fixed for the next 120 days, a resource that past governments have resorted to.
“These measures are complex to monitor and have very little effect on inflationary dynamics in the medium term if they are not accompanied by a stabilization plan that curbs indexation and inflationary inertia,” Delphos Investment firm said in a report.
The Argentine Economy Minister, Sergio Massa, commented that this program does not solve the problem of inflation by itself, but requires an “orderly” fiscal policy and the accumulation of monetary reserves.
with EFE
