In the month following the general election, from which the government emerged victorious, and with a calming foreign exchange market, Inflation in November remained at a similar level to October, closing at 2.5%.. The figure was higher than predicted by most analysts, who had predicted no drilling would occur at 2%.
The price increase has totaled 27.9% so far this year and was 31.4% in the last 12 months. as reported this Wednesday by the National Institute of Statistics and Censuses (Indec). Core inflation, which does not take into account seasonal increases or regulated services, rose 2.6%, up from 2.2% in October.
It is the first time this year that inflation for a month is higher than that of the same month in 2024 (over this period the CPI was 2.4%).
The area with the largest increase in the month was housing, water, electricity, gas and other fuels (3.4%), followed by transportation (3%).; However, food and non-alcoholic drinks came in third place (2.8%). “The area with the greatest impact on regional monthly variation was food and non-alcoholic beverages“said the official report.
In contrast, the two divisions that saw the lowest fluctuations in November were home appliances and maintenance (1.1%) and clothing and footwear (0.5%). “At the category level, regulated pricing (2.9%) led the increase, followed by core CPI (2.6%) and seasonal pricing (0.4%).” says the Indec report.
As already mentioned, the price increase was above market analysts’ expectations.. The Market Expectations Survey (REM) – conducted by the Central Bank (BCRA) among consultancies, banks and other private sector players -, had thrown that The market did not expect inflation to break the 2% monthly floor in the final months of the year, the level it has been at since September. Actually, forecast a November CPI of 2.3%.
In the city of Buenos Aires, the November inflation rate somewhat suggested that the national figure would be above 2%. As the Buenos Aires Statistics Institute announced this Wednesday, its index was 2.4%, slightly higher than the 2.2% recorded in October and November and above August (1.6%).
The Indec data comes in an environment where the economy was calm after the official victory in the general elections and the foreign exchange market stabilized after the government emerged stronger from that victory. Added to this is a significant decline in country risk and a significant recovery in local company stocks..
More broadly, the BCRA survey of private market participants found that inflation will be just over 30 this year: Specifically, he estimates it at 30.4% (in the previous survey he had predicted a value between 29.9 and 29.6%).
If this forecast comes true, the majority of private consulting firms agree – as can be seen from a statement published by THE NATION two weeks ago This would be the lowest annual inflation since 2017, the year the CPI was 24.8%.
According to their agreement on that occasion, the main difficulty was in achieving a monthly drilling rate of 2% The sharp increase in the food sector – especially meat – and the adjustments to regulated prices such as gas, electricity and transport tariffs.
Still, these analysts expected it The data would be positive and that the challenge from then on would be to maintain the downward trend in 2026 in order to end this year with inflation below 20%.
Beyond this progress in reducing inflation, this variable began to have less weight in the official discourse, as opinion polls have shown for months that other concerns are more important for Argentines.. Although reducing inflation is the official policy most recognized by respondents, a survey conducted last month by Casa Tres, led by Mora Jozami, placed the “economy in general” at the top of the concern rankings (16%). Then comes “corruption” (15%) and further back “low salaries” (11%).
The analysts’ view
Economist Florencia Iragui from consulting firm LCG mentioned that inflation accelerated in November compared to October. “In Greater Buenos Aires, for example, food and beverage inflation accelerated to 2.8% monthly (compared to 2.3% monthly in October), explaining almost 30% of monthly inflation. But in the North West, the same item explained almost 50% of the region’s monthly inflation, rising 3.3% monthly,” he analyzed.
Another notable fact for Iragui is the acceleration of core inflation: 2.6% monthly, while the average over the last three months was 2.1% monthly. “If we add to this the acceleration of the increase in regulated prices, especially for housing, electricity, gas and water and transport (3.4% and 3% monthly, respectively), this further pushes prices to intensify their increase month-on-month, especially if we think about what are second rounds in tariff increases,” the economist added.
According to Iragui For December, a month with higher inflation pressure due to holidays, bonuses, bonuses and others, the possibility of reducing this percentage of monthly inflation is somewhat unclear. “For the following months, we continue to believe that it appears difficult to finally break the 2% floor, although it is not an election year and some announcements could be made as the months go by, expectations could help bring inflation down,” he said.
Meanwhile, economist Claudio Caprarulo, director of consulting firm Analytica, commented: “The increase accelerated for the second month in a row, reaching 1 percentage point above the previous year’s level in May. The increase in meat had a strong impact, almost 7%, a trend that continued in December, we noted a 2% increase in the first week of the month.”
For her part, economist María Castiglioni, director of C&T Economic Advisors, explained that the November CPI was in line with her consultancy’s expectations and that the figure was mainly due to the increase in meat consumption. “The most negative point of this data is that after a long time, the increase in prices of some sensitive foods, some fruits, meats and oils affected the cost of the basic food basket, which increased by 4.1% during the month.“, he emphasized.
Looking at possible inflation in December, Castiglioni pointed out that he sees a first week of certain food price increases, which would be on top of whatever some regulated companies are adjusting. “Our forecast for the entire month is that it will be just over 2%, probably below November’s level, and will finish the year just above 30“ concluded the economist.
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