Argentina's consumer price index rose 2.1% in July from June, slightly exceeding the 2% median forecast in a Bloomberg survey. That uptick interrupted a three-month stretch of decelerating monthly inflation, a modest disappointment for President Javier Milei. The prior month had seen the first sub-2% monthly increase in ten months, but that streak came to an end with July's data.
On an annual basis, inflation rose to 33.8% from 33.5% the prior month, also above forecasts. The national statistics agency Indec released the figures on Thursday, August 13, 2026. This follows a stronger-than-expected price increase in Buenos Aires last week. Both the monthly and yearly figures exceeded analyst predictions.
The culture and recreation segment led with a 5% advance. Restaurant and hotel prices rose 2.8%. Excluding volatile items, core inflation was 1.8%, below the headline 2.1% increase.
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Bloomberg Economics' Argentina economist Jimena Zuniga said: "Another contained Argentine CPI print in July maintains the scope for a relatively lax monetary stance amid competing policy objectives. We've been skeptical that past deceleration proved disinflation had resumed on a clear path, but think consumer-price increases are tame enough to stay the policy course."
Ahead of the CPI data, Economy Minister Luis Caputo introduced a measure permitting companies without dollar earnings to borrow in U.S. dollars. This aims to deploy the record stockpile of dormant dollars. The initiative seeks to spur an economy that has lagged, particularly in labor-intensive industries.
The July inflation print comes as President Milei's administration continues to pursue fiscal austerity and market-oriented reforms. While the disinflation process has been significant - from triple-digit annual rates in 2024 to the current 33.8% - the uneven monthly readings highlight the challenges ahead. The government's new initiative allowing non-dollar earners to borrow in dollars is part of a broader effort to unlock the country's monetary stockpile and stimulate investment, particularly in sectors that have struggled to recover.
The July figure complicates the narrative of steady disinflation that had emerged after three consecutive monthly declines. Those earlier gains had raised hopes that the central bank could maintain a looser monetary stance. However, the acceleration - driven by seasonal factors and sharp increases in culture and recreation - suggests the path to lower inflation remains uneven. The core reading of 1.8% offers some reassurance, but the headline miss on both monthly and annual measures keeps pressure on policymakers.
In a July central bank poll, analysts projected year-end 2026 inflation at 29.8%, a slight cut from the prior 30% estimate. They also lowered their 2026 GDP growth projection to 2.7% from 3% in June. That year-end forecast remains below the current 33.8% annual pace, implying expectations of further cooling in the second half of the year. The July data, however, underscores how fragile that outlook may be, especially with seasonal price pressures and the government's new dollar-loan initiative still in early stages.
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