MercoPress. South Atlantic News Agency

Official (fantasy) inflation in Argentina 0.8% in July and 9.9% last 12 months

Indec CPI numbers have been questioned since 2007

Official consumer inflation in Argentina reached 0.8% in July accumulating 9.9% in the last twelve months and 5.9% in the first seven months of the year, according to the Indec statistics bureau.

Indec said the biggest price gain in July was seen in the “other goods and services” category, which jumped 3.9%. The category includes products such as shampoo, diapers and hair dye as well as notary, burial and barbershop services.

Leisure costs rose 1.7%, while household goods were up 1.1%. Costs in the heavily weighted food-and-drink sector climbed 0.6% in July compared with 0.9% in June, when overall inflation was reported at 0.7%.

However the government's inflation figures have been discredited since 2007 as too low to reflect true price growth. Private estimates tend to double or even triple the official number.

Among others the World Bank, IMF, The Economist magazine do not recognize the official Indec inflation rates and Argentine organized labour as well as independent unions admitted having their own measurement of what they call “supermarket inflation” and the basis for salary negotiations.

On Thursday Argentine opposition lawmakers presented the so called “congressional index” based in the analysis of nine private agencies and which showed a 1.76% increase in July, accumulating 24.13% in the last twelve months.

Private agencies are exposed to high fines if the release inflation indexes without revealing their methodology which is obviously questioned by the government of President Cristina Fernandez.

Latin America's number three economy is quickly losing steam after several years of sustained growth but high price rises are entrenched and annual inflation expectations hold at over 30% according to private data from the respected Torcuato Di Tella university.