Argentina: April’s monthly inflation set at 8.4%

Argentina: April’s monthly inflation set at 8.4%

Argentina’s National Institute of Statistics and Census (Indec) Friday announced that inflation for the month of April of 2023 was 8.4%, way above all projections. Interannually, the Consumer Price Index (CPI) reached 108.8% and the accumulated variation in the first four months of the year was 32%. It is the highest monthly inflation since April 2002 (10.4%) and the highest year-on-year figure since 1991. Since Alberto Fernández took office in December 2019, prices increased 448%.

Instead of stabilizing or going down, inflation in the South American country has been growing since the beginning of the year: January (6%), February (6.6%), March (7.7%), and last month (8.4%). With these figures, the price index may well reach double digits in the next few months.

The Greater Buenos Aires area was where prices rose the most in general, with an increase of 8.6% in the last month. It was followed by the Pampas region (8.5%) and the Northeast (8.3%). The lowest price increase was in the Cuyo area, although the increase was 7.2%.

Inflation remains on the rise due to the large monetary emission to finance State spending with the credit market closed, it was explained.

Private projections expected inflation for May to reach 7.4%, according to the last Relevamiento de Expectativas de Mercado (REM) published by the Central Bank (BCRA) before Friday’s figure was released.

The report also forecasts a 7% monthly floor until October. Inflation in 2023 is expected to exceed 126% but these projections are constantly being revised upwards.

President Alberto Fernández admitted before the official data was released, that there is “a very serious problem with inflation” and that “it is very difficult to control.” He blamed the foreign exchange run, “which took the dollar from AR$460 to AR$500 and something”, and said that “this price increase operates in the head” of Argentines. He insisted that speculation was a key factor. Prices go up “just in case,” explained the president, who admitted that the inflation for April “is not what we want.”