Argentina’s triple-digit inflation slows, but cash-strapped workers struggle to pay bills

7:12 am Thursday, October 10th, 2024

By Horacio Fernando Soria

BUENOS AIRES (Reuters) – Argentina’s triple-digit inflation, the world’s highest, is starting to slow but this offers little relief for residents whose salaries have stayed the same while costs of basic goods sky-rocketed and the government slashed state subsidies.

“We’re losing track of what’s expensive and what’s cheap,” said university professor Daniel Vazquez while shopping in Buenos Aires. “Prices keep going up and the only thing that isn’t going up is salaries.”

“The gap is very, very big,” he said.

Analysts expect full-year inflation of around 124% in 2024, even though September inflation is expected to have slowed to a month-to-month rate of 3.5% with the same rate of monthly increase in October. The 12-month inflation rate remained well into the triple digits at 237% in August.

Libertarian President Javier Milei has cut subsidies to sectors such as energy and transportation, while vowing to trim what he calls bloat in the public sector, shuttering some offices and trimming jobs.

But the tough austerity drive has prolonged a recession and caused poverty rates to surge to around 53%.

Computer programmer Ivan Cortesi, 30, said while food prices remained similar to last month, utility costs rose significantly.

“This past month there has been a significant increase in all utilities,” he said.

Milei devalued the local currency when he took office in December, and the sharp spending cuts have particularly hit informal workers, civil servants, pensioners, doctors and teachers.

On Wednesday, Argentina’s Congress failed to overturn Milei’s controversial veto of a law that would have shored up university spending in line with inflation, following mass protests by students and university workers against the measure.

Milei has vowed to veto any law that threatens the fiscal balance.

(Reporting by Horacio Fernando Soria; Writing by Sarah Morland; Editing by David Gregorio)