Buenos Aires:
Argentina's inflation rate has fallen to 193%, falling below the 200% threshold for the first time in almost a year, data from statistics agency INDEC showed on Tuesday, as President Javier Milei's dramatic austerity agenda bears fruit.
However, slowing inflation, partly curbed by dramatic adjustments in government spending, has come at the expense of consumption in a battered economy with more than half the country falling into poverty.
INDEC data shows that monthly inflation slowed to 2.7% in October from 3.5% the month before, the lowest level since November 2021. The annual inflation rate fell below 200% for the first time since November last year.
While rental and utility costs drove monthly price increases by 5.4%, prices for transportation, food and non-alcoholic beverages rose only 1.2% from the previous month.
But the good news may be hard to grasp for Argentines who have had to tighten their belts to make it to the end of the month.
The government has cut subsidies for public services and increased layoffs in the public sector. Inflation is still very high by global standards and has contributed to a deep decline in purchasing power.
“Sales have fallen sharply. Maybe people are coming to buy more small quantities every day, and you can see that,” said Maria Sunilda Correa, who works in a poultry store.
Consumers are buying less beef in the famously steak-loving country after Milei ended the previous government's beef price freeze. According to a report by industry group Ciccra, beef consumption fell to the lowest level in thirteen years in the first six months of the year.
“The price of meat has not increased these months because very little is consumed. As consumption decreases, so do sales. And well, it's a bit complicated,” said Gabriel Segovia, a 52-year-old butcher in Buenos Aires.
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