MercoPress. South Atlantic News Agency

January inflation in Argentine higher than expected

Many measures adopted by Economy Minister Sergio Massa are backfiring ahead of this year's presidential elections

Argentine authorities are admitting that inflation in January of 2023 was “high” and that in that scenario meeting the targets agreed upon with the International Monetary Fund (IMF) will not be easy. At the same time, Economy Ministry teams were reported to be planning new batches of measures to reverse the negative impact of prices going up, it was reported in Buenos Aires.

The National Institute of Statistics and Census (Indec) is yet to release the official figure for January 2023 but one thing is for certain -- it will be higher than expected.

After announcing seven cuts of meat added to the Fair Prices program, Economy Minister Sergio Massa admitted that there is concern about the increase in food values. “Why are we paying so much attention to meat? Because when we look at January inflation, one of the items that appears as hitting them in a seasonal way is meat, [but it is] not the only one,” he said.

“Today, tomorrow, and the day after, we will be announcing measures related to the micro, but also strong measures related to the macro, so that the fiscal order, the accumulation of reserves, and the defense of the value of the Argentine sovereign debt are instruments that allow us to definitively stabilize the Argentine economy to make it competitive, and so that the citizen does not suffer that sawing that many times occurs in the prices of our economy,” Massa explained.

The inflation index for January to be announced Tuesday is believed to be between 5.7% and 6.3%, it was reported. At any rate, it will jeopardize Massa's previous forecasts that inflation by April would be around 3% monthly.

January's figure will be mainly driven by a strong increase in fresh products, electricity rates in 14 provinces, and tourism, particularly lodging and restaurants. Restrictions on access to foreign currency led Argentines to vacation domestically which in turn resulted in skyrocketing prices for captive consumers.

The Fair Prices initiative had little effect since products under that program are only available at large-chain supermarkets and not at the local store next to people's homes. With the increasing costs of car ownership, there are fewer and fewer people who can do their shopping many blocks from their homes.