© Reuters. FILE PHOTO: A vendor weighs produce in a market as inflation in Argentina hits its highest level in years, causing food prices to soar, in Buenos Aires, Argentina April 12, 2022. REUTERS/Mariana Nedelcu / File Photo
By Walter Bianchi
BUENOS AIRES (Reuters) – Argentina’s monthly inflation rate was weaker than expected in September, a rare reprieve for the struggling economy and struggling residents, which could allow the central bank to suspend its aggressive rate hike cycle at the moment.
The government statistics agency INDEC reported on Friday that monthly inflation was 6.2% last month, slower than in August and below analysts’ forecasts for a 6.7% increase.
Reuters reported earlier on Friday, citing sources, that the central bank intended to delay another interest rate hike due to optimism that inflation was on a downward trajectory, which would break a series of successive increases this year which saw the reference rate climb to 75% from 38%.
Yet annual inflation is expected to hit 100% by the end of the year, one of the highest rates in the world, as the grain-producing South American nation faces a wide range of economic crises. and a beleaguered peso currency.
Inflation in the 12 months to September has hit 83% as President Alberto Fernandez’s government scrambles to contain soaring prices that are undermining people’s wages and savings. Prices rose 66.1% in the first nine months of the year.
Aldo Abram, executive director of consultancy Libertad y Progreso, said inflation would remain high next year, before receding ahead of presidential elections.
“It’s likely to come down a bit, having even increased to 110% or more in the first half,” he said.
Argentines on the street said they were finding it increasingly difficult to afford things as prices exceeded wages.
“You have to pay attention to the cost of things because there are things you can’t afford. You have to cut things out of your diet because salaries can’t keep up,” Claudia Villalba, a housewife at 53 years. .
“Some people are having a really bad time.”