Argentina’s inflation rate rose to 4.6% in June 2024, breaking a five-month streak of deceleration and marking the highest monthly increase in the past year. The National Institute of Statistics and Censuses (INDEC) reported that the annual inflation rate reached a staggering 271.5%, with a 79.8% increase in the first half of the year.The main driver of June’s inflation surge was the housing, water, electricity, gas, and other fuels sector, which saw a 14.3% increase due to the government’s decision to reduce subsidies on essential services. This was followed by increases in restaurants and hotels (6.3%) and education (5.7%).President Javier Milei’s government, which took office in December 2023, has implemented strict economic adjustments, including freezing federal works, halting transfers to states, and removing subsidies for essential services. Despite these measures, the government faces significant challenges in controlling inflation while maintaining public support.Minister of Economy Luis Caputo attempted to put a positive spin on the data, stating that it was the second-best result in the past year. However, the increase has raised concerns about the effectiveness of the government’s economic policies.The impact of inflation is being felt across the country, with the poverty line for a household of four members reaching $873,168.77 in June, a 275.7% increase from the same period last year. The food and beverages sector, crucial for basic living standards, experienced a 3% increase in the last month and a 285.1% increase over the past year.Regionally, the impact of inflation varied, with the Cuyo region experiencing the highest monthly increase at 5.1%, followed closely by Patagonia at 5%. The Great Buenos Aires, Northeast, Northwest, and Cuyo regions were particularly affected by increases in housing and utilities costs.Despite the setback, some government officials remain optimistic. Minister of Security Patricia Bullrich stated, “With security and decreasing inflation, the country is moving forward”. President Milei himself took to social media to celebrate the 4.6% figure, criticizing analysts who had predicted higher rates between 5.5% and 6.5%.However, Argentina continues to lead Latin America in inflation rates for the ninth consecutive month, significantly outpacing neighboring countries like Brazil, Uruguay, Peru, and Colombia, which have recorded inflation rates below 1% in June.As the country grapples with this economic challenge, the coming months will be crucial in determining whether the government’s policies can effectively curb inflation and restore economic stability.
Key points
- Argentina’s inflation rate rose to 4.
- The annual inflation rate reached 271.
- The main driver was the housing, water, electricity, gas, and other fuels sector, which saw a 14.
- President Milei’s government faces challenges in controlling inflation while implementing strict economic adjustments.
6% in June 2024, breaking a five-month streak of deceleration.
5%, with a 79.
8% increase in the first half of the year.
3% increase due to tariff hikes.
Contradictions👾While Minister of Economy Luis Caputo and President Milei celebrated the 4.
6% figure as a positive outcome, other sources describe it as a setback and a blow to the government’s economic policies.
