BUENOS AIRES — Argentina’s monthly inflation rate stood at 5.1% in December, official data released on Thursday showed, while annual inflation in the South American country reached nearly 95% over the previous 12-month period.
December’s rate of rising consumer prices came in above the economy minister’s expectation but slightly below analyst forecasts.
Analysts expected a rise of 5.2% in December, according to the median response in a Reuters poll of analysts, while the government was hoping the increase in prices would stay under 5% in the last month of 2022.
The South American country is battling one of the highest inflation rates in the world, which in the 12 months through December hit 94.8%, national statistics agency INDEC said, as soaring prices hamper growth and erode salaries and purchasing power.
Slowing inflation led Argentina’s central bank to hold its benchmark interest rate steady at 75% on Thursday, extending a pause on hikes after one of the world’s most aggressive tightening cycles.
In a recent interview, Economy Minister Sergio Massa projected monthly inflation would not exceed 5% in December and said the government aims for it to edge down to around 3% in April.
Prices of fruits and vegetables were showing an upward trend during December, while meat price rises slowed, according to Lucio Garay Mendez, economist at consultancy EcoGo.
Economists expect monthly inflation to hover around 5% at the start of 2023, driven by an economic slowdown and price cap agreements on retail products.
“But risks remain elevated, and the shortage of (U.S.) dollars may translate into a further escalation of parallel (market) dollars, leading to higher inflation,” said Isaias Marini, an economist at consultancy Econviews. (Reporting by Hernan Nessi; Editing by Jonathan Oatis, Brendan O’Boyle and Sandra Maler)