Argentina’s inflation rate is on the rise, with February showing 2.4% and March potentially exceeding 2.9%. Spending has dropped significantly, and consumption has fallen nationwide for over a year. Families face increased costs for essential goods. Although regional disparities exist, Buenos Aires City shows different inflation dynamics. Central Bank projections indicate continued inflation challenges ahead.
Argentina’s National Institute of Statistics and Census (Inec) reported a 2.4% increase in the National Consumer Price Index (IPC) for February, with March projections suggesting inflation may escalate past February’s core rate of 2.9%. Analysts in Buenos Aires attribute this to a notable decline in spending, with mass consumption dropping by 10.2% last month.
Inflationary pressures are bolstered by seasonal factors, including the start of the school year and rising transportation costs. Economists highlight ongoing currency volatility and necessary economic adjustments as contributing to inflation challenges in the country.
For 15 straight months, nationwide consumption has declined, with particularly sharp drops recorded in soft drinks, alcoholic beverages, and household goods. In February 2025, a year-on-year contraction of 9.8% was reported, marked by substantial declines in sales at supermarkets and self-service stores, although the rate of decline has improved since October 2024.
The basic food basket (CBA) saw a 3.2% increase in February, the most significant rise in six months, eclipsing the poverty-line basket’s 2.3% increase. A typical family now requires AR$ 1,057,923 (approximately US$ 881.6 at the unofficial blue rate) monthly to avoid poverty, and AR$ 468,108 (around US$ 309) to avoid indigence, underscoring persistent economic hardships.
Inec’s report indicated a 2.4% inflation rate in February, a rise from January’s 2.2%, with an accumulated annual increase of 66.9%. Year-to-date, prices have surged by 4.6%. The most significant price hikes occurred in Housing, Water, Electricity, Gas, and Other Fuels, which rose by 3.7%, and Food and Non-Alcoholic Beverages by 3.2%, largely due to higher meat prices.
Conversely, Household Equipment and Maintenance increased by only 1%, while Clothing and Footwear experienced a minimal 0.4% rise. Regional inflation varied, with the highest numbers in Patagonia (3.2%), Cuyo (2.7%), Northwest (2.6%), and Pampas (2.5%), contrasting with Greater Buenos Aires (2.2%) and Northeast (1.9%), which were below the national average.
Interestingly, inflation in Buenos Aires City saw a decline to 2.1%, spurred by a 4.8% reduction in tourism-related services, despite its year-on-year inflation being higher at 79.4%. Additionally, unemployment in Buenos Aires spiked by 50% over the past year. The Central Bank (BCRA) forecasts indicate inflation rates of 2.3% for February and 2.2% for March, marking a departure from prior downward trends.
Argentina is facing rising inflation pressures, attributed largely to a decline in spending and seasonal factors. A notable increase in the basic food basket reinforces the economic challenges many families face, as they struggle with rising living costs. The stabilization of consumption decline in recent months offers a glimmer of hope, but projected inflation rates suggest that challenges persist, while disparities in inflation rates across regions highlight the uneven economic recovery.
Original Source: en.mercopress.com
