Argentina: Inflation drops to lowest level since December 2023 in August
Inflation drops to lowest level since December 2023 in August
Latest reading:
Latest reading: Inflation came in at 236.7% in August, down from July’s 263.4%. August’s figure marked the weakest inflation rate since December 2023. Looking at the details of the release, prices for transportation and food and non-alcoholic beverages rose at a more moderate pace in August.
Annual average inflation rose to 242.1% in August (July: 236.0%).
Lastly, consumer prices rose 4.17% over the previous month in August, picking up from the 4.03% rise seen in July and slightly above market expectations.
Inflation came in at 236.7% in August, down from July’s 263.4%. August’s figure marked the weakest inflation rate since December 2023. Looking at the details of the release, prices for transportation and food and non-alcoholic beverages rose at a more moderate pace in August.
Annual average inflation rose to 242.1% in August (July: 236.0%).
Lastly, consumer prices rose 4.17% over the previous month in August, picking up from the 4.03% rise seen in July and slightly above market expectations.
Panelist insight:
Panelist insight: On the data and outlook, Itaú Unibanco analysts said:
“Despite the upside surprise in the August’s print, we expect further disinflation in the coming months, as a result of exchange rate dynamics, one-off effects of import tariffs reductions, and subdued demand-side pressures. Thus, we still foresee downside risks for our 130% inflation forecast by YE24.”
BBVA analysts said:
“In September, the government reduced the PAIS tax from 17.5% to 7.5% for imports of goods and freight, which will contribute to some deceleration in certain specific prices this month. […] Additionally, the government has not indicated any changes to the current exchange rate adjustment scheme of 2% month-on-month in the short term. Considering this, we have revised down our annual inflation forecast for 2024 from 135% to 130%.”
On the data and outlook, Itaú Unibanco analysts said:
“Despite the upside surprise in the August’s print, we expect further disinflation in the coming months, as a result of exchange rate dynamics, one-off effects of import tariffs reductions, and subdued demand-side pressures. Thus, we still foresee downside risks for our 130% inflation forecast by YE24.”
BBVA analysts said:
“In September, the government reduced the PAIS tax from 17.5% to 7.5% for imports of goods and freight, which will contribute to some deceleration in certain specific prices this month. […] Additionally, the government has not indicated any changes to the current exchange rate adjustment scheme of 2% month-on-month in the short term. Considering this, we have revised down our annual inflation forecast for 2024 from 135% to 130%.”