Consultancy: annual inflation at 42%

Annual inflation over the last 12 months hit 42 percent, new data released by
the Elypsis consultancy agency showed yesterday, suggesting that the massive
price hikes seen in recent months have contributed to a drastic rise in the rate
and created a gloomy outlook for one of the government’s key economic
targets.

Let’s Change (Cambiemos) officials however argue that the picture is

improving, with Lower House caucus leader Nicolás Massot pointing to an
expected drop in monthly inflation for May, down from the spike of around
seven percent last month.

Elypsis however said its latest figures illustrated an “acceleration” in annual

inflation that showed no apparent signs of slowing in the immediate future,
casting further doubt on the likelihood that President Mauricio Macri’s
government will manage to keep inflation below its 25-percent target for the
calendar year, in line with previous pledges.

“Annual inflation continues its upward trend and has accelerated. Having closed
in March at a 33.4 percent annual rate, and April with 40.1 percent, our latest
record so far this year recorded a cumulative price increase of 42.2 percent,” the
consultancy firm said in its latest report released yesterday.

The government previously set a target of 20-25 percent annual inflation for
2016, but recently distanced itself from the goal in the light of worse-than-
expected data.

At the start of the month, Central Bank Governor Federico Sturzenegger said
that the annual target would now be set in September of this year and suggested
Finance Minister Alfonso Prat-Gay’s initial 25-percent target was more likely to
be achieved in 2017.

Sturzenegger nonetheless insisted last week that inflation in Argentina “was

already falling” and predicted it would stabilize at around five percent by 2019.