Argentina: Inflation unchanged in December
January 19, 2012
In December, consumer prices rose 0.84% over the previous month, which was up from the 0.59% expansion recorded in November but in line with the increase recorded in December 2011. As a consequence, annual headline inflation was unchanged at November's 9.5%, its lowest level since February 2010. Official inflation data published by the National Statistics Institute (INDEC) are continually met with suspicion ever since a controversial change to the price variation measurement methodology was implemented three years ago. As a result, private sector analysts have begun to report independent inflation estimates that differ notably from the official figures. The government has repeatedly denied allegations that INDEC data are manipulated and, in March 2011, went a step further by beginning to fine a number of consulting firms for publishing independent inflation estimates. Against this backdrop, on 1 February the International Monetary Fund issued a press statement criticizing the lack of progress shown by INDEC in aligning the reported consumer price statistics with the guidelines required to all its member states. The IMF called on Argentina's authorities to implement specific measures in order to improve quality of inflation data within 180 days from the issue of the statement. Consumers share private analysts' more realistic inflation assessments. According to a Universidad Torcuato di Tella (UTDT) survey conducted in January, households believe that consumer prices will increase 25% over the next 12 months, which is in line with results from the December survey.
Author: Armando Ciccarelli, Head of Data Solutions