MercoPress. South Atlantic News Agency

June's “official” inflation in Argentina 0.4%, but it's hard to believe

Argentina' “devalued” Statistics and Census Office, Indec, announced on Thursday June's “official” inflation, 0.4% and 3.9% for the first half of the year which is one full point off from the same period in 2006.

As happened in previous months, food was the main boost behind the prices index having reached 4.9% in the first half of 2007. However the so called Basic Food Basket which determines the indigence level increased less: 0.3% over May and 3.6% in the first semester. This means a family of four in Argentina needs an income of 429 pesos monthly equivalent to 145 US dollars not to fall into the indigence category. Similarly to remain above the poverty line a family of four must make 923 pesos per month equivalent to 305 US dollars. Five other items were also above the monthly index: Clothing 4.8%; Housing and basic services 4.5%; equipment and maintenance of homes 5.1%; education 5.6% and other goods and services 5.4%. Indec also announced that construction costs climbed 1.6% in June which is equivalent to 11.1% in the first six months of 2007. Similarly wholesale prices jumped 1.9% accumulating 7.2% so far this year. But in spite of the "official" 0.4%, private estimates are closer to one full point inflation in June. The Statistics and Census Office has been under permanent surveillance, and suspicion, since the Kirchner administration intervened and made some unexpected removals in leading posts and changed part of the criteria to calculate the index. In effect the technical staff responsible for the elaboration of the monthly consumer index sent last week a setter to a Buenos Aires federal Judge stating that they are not responsible for the consumer prices indexes that are being "officially" released and circulated. Indec technical staff claim that that irregularities are being committed in the elaboration of the index, with "results which are not consisted with reality; there is manipulation of data in the informatics system; staff that has worked for years in the indexes has been replaced by personnel without experience in critical responsibilities", among other things.