MercoPress. South Atlantic News Agency

CPI climbs 3.2% in June in Argentina, 25.3% in first semester of 2021

The first semester of 2021 shows a retail inflation of 25.3% and 50.2% YoY

The Argentine Central Bank's monthly Survey of Market Expectations (REM) has matched the National Institute of Statistics and Census (INDEC) announcement Thursday of a 3.2% increase in retail prices nationwide.

Local consulting firms had accurately forecast it would be below the 3.3% registered in May, according to a study carried out by the Central Bank at the end of each month.

Analysts agreed the slowdown in inflation was noticeable since April, which is basically due to a rise in unemployment and the subsequent decreasing demand.

With Thursday's figures, the first semester of 2021 shows retail inflation of 25.3% and 50.2% YoY.

”Monthly inflation shows a decreasing trend. As expected, March was the month with the highest inflation in the year (with 4.8%) and from then on a reduction in the monthly rate began and is expected to continue along these lines,“ said the Ministry of Economy through a statement.

This downward trend was also evidenced in wholesale inflation, which went from a peak of 6.1% per month in February to 3.2% per month in May, according to the latest data available.

”This deceleration trend is expected to continue for the rest of the year,“ the statement went on. ”This disorderly inflation is a new phenomenon typical of the pandemic, not only in Argentina, but it is also making it difficult for other countries to meet their goals,“ the document added, citing Brazil and the United States as examples.

In any case, ”core inflation” was once again above the average, with 3.6%, while seasonal prices rose only 0.5%, due to a fall in fruits, vegetables, tubers, and legumes. Food and non-alcoholic beverages also went up 3.2%.

On the other hand, the rise in cigarettes and telephone and internet fares had an impact on the “regulated market”, which rose 3.2%, boosted by an increase in cooking gas nationwide, which accounted for most of the rise in utilities which combining water, electricity and other fuels, reached 2.5%.

Communication fares prices also grew 7%, compared to 1% in May, mainly driven by the increase in mobile phone services and, to a lesser extent, internet connection service.

Alcoholic beverages and tobacco showed an increase of 5.5%, compared to 1.6% in the previous month, while clothing and footwear also stood out rose 3.5% in June against 2.1% in May.

In the first half of 2021, increases of 26.4% in food and beverages; 29.3% in clothing and footwear; 37% in education, and 32% in transportation played the largest part.