Argentina’s consumer prices rose 2.2 percent in October, up from 1.9 percent in September and the highest monthly rate in six months, national statistics agency INDEC reported on Thursday. The reading came in above the 1.9 percent median expectation in a Reuters poll of analysts. The 12-month inflation rate eased slightly to 33.1 percent from 33.4 percent, and prices were up 26.3 percent in the first ten months of the year.
The composition split the government’s argument from its critics’. Housing, water, electricity, gas and other fuels rose 4.2 percent on the month, the sharpest category increase, after changes to the Cold Zones regime sharply curtailed gas subsidies for about 2.4 million users, a factor Economy Minister Luis Caputo cited in arguing the jump was largely administered rather than demand driven. Core inflation, by contrast, fell to 1.5 percent on the month from 1.7 percent in September.
For rates, the print matters less for any single central bank decision than for the credibility path: a second consecutive monthly acceleration, driven by regulated prices and seasonal food items, means the disinflation the market had extrapolated toward single digits annually is arriving more slowly, and November’s reading will decide whether October was a subsidy adjustment or a stall.