Argentina’s inflation is projected to rise to 2.4% in February, up from 2.2% in January. Despite government efforts, inflation remains a pressing issue, with food prices exerting upward pressure. Analysts predict continued inflation increases into March as seasonal factors come into play.
A recent Reuters poll indicates that Argentina’s inflation rate for February is anticipated to rise to 2.4%, marginally up from January’s 2.2%. This outcome reflects persistent economic challenges faced by Argentina, known for experiencing the highest annual inflation rate globally, reaching nearly 300% earlier last year before tapering to 118% at the end of 2024. Monthly inflation has consistently ranged between 2% and 3% since October 2024, after peaking at 25% in December.
The consulting firm Eco Go highlighted that the Argentine government’s efforts to lower inflation have not fully materialized, stating, “The government’s goal of breaking the 2% barrier has not been fully realized, and in February, inflation may have even accelerated.” These efforts included adjusting the crawling peg to 1%, addressing the exchange rate gap, and updating tariffs without significant success.
A Market Expectations Survey (REM) from Argentina’s central bank foresees a February inflation rate of 2.3%, with a further decrease to 2% expected in March. The foundation Libertad y Progreso (LyP), however, remarked that mid-February CPI growth was lower than January’s rates, which led to initial expectations of a slowdown in inflation. Nonetheless, increases in food prices, particularly for meat, drove inflation spikes in the latter half of the month.
Clara Alesina, an economist at LyP, mentioned that while a downward trend exists for the consumer price index (CPI), “a slowdown is not expected in March,” due to the start of the school year and the revival of significant economic sectors potentially increasing seasonal price pressures.
In summary, Argentina faces continued inflationary pressures, with February’s rate expected to rise slightly due to seasonal factors and increased food prices. Despite government initiatives to stabilize the economy, challenges remain, and analysts predict further inflation increases in March. The situation underscores the complexities of managing Argentina’s economic landscape amid persistent inflation.
Original Source: money.usnews.com
