Inflation ticks up slightly in Milei's Argentina, rising to monthly 2.1%

Argentina's inflation rate increased slightly to 2.1 percent in July, as reported by the INDEC national statistics bureau. This marks the end of a three-month decline in monthly inflation, after a period of sustained disinflation from May. Over the past year, inflation has reached 33.8 percent, with prices up 19.3 percent since the start of the year.

The sector with the highest monthly increase was recreation and culture, recording a 5 percent rise. In contrast, restaurants and hotels saw a 2.8 percent increase. Healthcare, goods and services, and housing and utilities also experienced price hikes of 2.4, 2.2, and 2.2 percent respectively. Clothing and footwear, on the other hand, saw a 1.3 percent decrease.

Prices in Greater Buenos Aires Aires saw the highest impact, rising by 0.2 percentage points above the national average. The government, led by President Javier Milei, had previously celebrated a June inflation rate of 1.9 percent, the lowest in 10 months. However, this achievement was erased by July's reading of 2.1 percent. Milei has promised to achieve zero monthly inflation by August 2026, a target that appears unlikely given the current inflation trend.

Market analysts had forecast a moderate rebound in July, influenced by seasonal factors and higher utilities and services costs, predicting an average increase of around two percent. The Central Bank's market expectations survey also predicted a two percent increase for July. Most consultancy firms estimated a July inflation rate of 2.1 percent, with the Fundación Libertad y Progreso and Eco Go aligning with this forecast.

Equilibra predicted a lower 1.8 percent, while Analytica projected 2.2 percent. The Buenos Aires City government's data institute earlier reported a higher 2.9 percent figure for the city, driven by a 3.8 percent increase in services and a 1.4 percent rise in goods.