Argentina's inflation accelerated in September but matched what economists expected, while the annual rate eased. Regulated tariffs and services drove the monthly increase, and economists surveyed by the central bank anticipate another output drop in the third quarter.
Argentina's monthly inflation accelerated slightly in September to match market expectations, yet held below a key threshold for a second consecutive month. State statistics agency INDEC reported on Tuesday that consumer prices rose 1.9%, up from August's 1.7% and in line with the median estimate of economists surveyed by Bloomberg.
On an annual basis, headline inflation eased slightly to 33.4%, extending a gradual downward trajectory.
Utility rates lead the monthly increase
Regulated tariffs and service costs primarily drove the monthly rise, with utility rates leading all categories. Housing, water, electricity and gas prices rose 3.1% after adjustment resolutions across regional distribution networks, while education costs advanced 3.0%.
Seasonal goods, however, provided a moderate offset, and core inflation slowed to 1.7% for the month. Food and non-alcoholic beverages, the heaviest-weighted category in the consumer basket, increased 2.0% and acted as the primary driver of price growth across most provinces outside the Greater Buenos Aires metro region.
Economists expect another output drop
The figures arrive as Argentina contends with persistent recessionary pressure. After a contraction in the second quarter, economists surveyed by the central bank anticipate another output drop in the third quarter, which would place the country in a technical recession.
As a result, growth expectations have seen significant downward revisions. Full-year GDP expansion for 2026 is projected at 1.5%, approximately half the rate investors had priced in at the start of the year.
Even so, market consensus suggests the disinflation trajectory remains intact for the near term. Central bank survey data indicates monthly CPI variations are expected to hover between 1.6% and 1.8% through March 2027, with annual inflation projected to cool toward 30% by the end of this year.
Source: Investing.com
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