MercoPress. South Atlantic News Agency

Argentina's July inflation 0.6% and 5.5% in seven months

In spite of a surge in services' costs Argentina's Consumer Price Index rose 0.6% in July, 0.1% higher than last May and June, but below the 1% of July last year, according to the latest release from the Statistics and Census Office, INDEC.

In the first seven months of 2006, the cost of living in metropolitan Buenos Aires has increased 5.5% compared to 7.2% in the same period a year ago.

The release also shows that the price of goods actually contracted 0.3% compared to June, and the basket of basic goods 0.2%, particularly because of a drop in seasonal food prices and winter fashion sales. The drop in winter clothing prices reached 2.8%.

But on the services side, it was a different store.

Leisure and tourism costs (winter holidays) jumped 7.6%; education 4.7%; maintenance and repairs in housing 5% and rents increased yet another 1%, totalling 8.2% in the seven months of 2006.

Apparently the Argentine government and its policy of arm twisting companies to keep prices from increasing has now set its eyes in the housing and rent market.

Indec also released the wholesale prices index which last July increased 0.7% totalling 11.4% in the last seven months.

Construction costs, in spite of the building boom, remained flat says Indec.