MercoPress. South Atlantic News Agency

September consumer prices in Argentina soar 1,2%

The Consumer Prices Index soared 1,2% during September in Argentina accumulating 8,9% in nine months according to the latest release from the Argentine Statistics and Census Institute.

The September index is four times August's 0,4% and pushes the annual projection dangerously close to the 2005 target of 10,5%.

The 1,2% index surprised most analysts who had forecasted a September increase in the range of 0,7% according to a market expectations poll taken by the Central Bank during the last week of the month.

The strong surge pulled by significant seasonal increases in fresh vegetables, 18,9%, fresh fruit, 10,7% and Clothing, 7,3%, also had an impact in the Basic Food Basket for the fifth month running. This index is crucial for measuring poverty and indigence in Argentina which is extensive to 40% of the population.

The new basic food basket for a family with two children now stands at 371 pesos (approx. 125 US dollars) per month, after having experienced a 2,2% increase in September.

Among the hikes outstand, potatoes 32%; peppers 75%; tomato 57% and hake fillet 23%. Rents rose 2,2% and the only item with a slight drop was Leisure, 0,5%. September wholesale prices registered a 1,7% advance and construction costs 0,5%. Argentine president Nestor Kirchner campaigning for October 23 mid term elections insisted "inflation was under control" and blamed the supermarkets' "cartel" for the latest surge in prices.

"Powerful economic groups are intent in de-stabilization and harming the Argentine people" warned Mr. Kirchner who added, "but we know how to deal with them".

The Argentine president also warned the oil companies that he said, "should be thinking and charging in peso-value and not dollar-value".

On the bright side Mr. Kirchner revealed that unemployment had dropped a further 0,7 percentage since the last release.

"We've managed to halve indigence, poverty is down 17 points, unemployment stands at 11,3% and we're re-launching the industrial sector after 14 years of constant retraction" President Kirchner said to a cheering crowd in the province of Buenos Aires where he's vigorously campaigning for a Senate seat for his wife, First Lady Cristina.