MercoPress. South Atlantic News Agency
August inflation in Argentina reverses tendency and again shoots up: 4%
Inflation hit 4% in August compared to July and 54.5% from a year ago, according to government data Prices in Argentina shot up last month after a shocking primary vote plunged the peso, reversing four months of declines.
Inflation hit 4% in August compared to July and 54.5% from a year ago, according to government data. The monthly figure was below economists’ estimate of 4.4%, but marked the fastest pace since last March.
President Mauricio Macri’s huge loss in the Aug. 11 primary to opposition candidate Alberto Fernandez sparked a massive selloff in Argentine assets. Investors fear Fernandez will undo Macri’s market-friendly stance and implement a populist economic agenda. The official vote is Oct. 27.
The peso fell 26% in August, forcing the government to delay debt payments and implement capital controls. Still, prices could rise even more in September because of a lag between the peso’s weakening and price adjustments, economists say. Analysts see September inflation at 5.8%, according to the central bank’s most recent monthly survey.
“September will be worse for inflation because the full pass-through to prices from the peso’s fall will be felt,” said Matias Carugati, an economist based in Buenos Aires. “The currency depreciation hit relatively late in August.”
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Read all commentsWhat??? Zero comments??? What the heck happened to the sharp MP commentators on all things Argentina? Have they been hit by a sudden bout of yellow fever?
Sep 14th, 2019 - 04:12 am +1Anyway, Argentina's agonizing situation should be at least a motive of analysis. How a government that applied the most orthodox free-market theories can drag a country to the ground in just four years?
It must be the USA, Macri said. Or the Russians. Or the drought. Wait, it's the fault of the previous government. No, it's rather the fault of the upcoming government.
EM,
Sep 17th, 2019 - 04:48 pm 0“How a government that applied the most orthodox free-market theories can drag a country to the ground in just four years?”
Wasn't it already on the ground? It was in technical default.
“Wait, it's the fault of the previous government. No, it's rather the fault of the upcoming government.”
You've nailed it. The credit ratings fit that explanation perfectly. Well done.
What rubbish. The US has been in technical default before when it screwed up its payments and it certainly didn't drive the country into the ground.
Sep 17th, 2019 - 05:06 pm 0In 2015 Argentina's economy was shaky and stalling, but it wasn't in recession, unemployment wasn't near 10% and inflation was much lower. Oh yeah, and they didn't owe $57,000,000,000 to the IMF. Whatever problems Macri inherited, he'll be passing on much bigger ones at the end of the year, with an added burden of debt repayments.
As for credit ratings, I remember when Osbourne insisted the UK needed austerity to preserve ours. It caused another recession and the ratings agency lowered it anyway. Pretty foolish, huh?
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