BUENOS AIRES (Reuters) – Argentine President Javier Milei’s dramatic austerity agenda has helped lower inflation, but the slowdown has come at the cost of consumption in a battered economy where more than half of the country has fallen into poverty.
The libertarian president, nearing a year in office, has celebrated falling inflation as one of his government’s key accomplishments, after one of the largest adjustments in public spending in recent history.
Data from Argentina’s statistics agency INDEC later on Tuesday is expected to show month-on-month inflation fell in October to 3.0%, down from 4.2% in August and 3.5% in September, according to a Reuters poll of analysts.
The good news can be hard to grasp for Argentines who have had to tighten their belts to make it to the end of the month.
The government’s slashing of subsidies on public services has sent expenses soaring, while public sector layoffs are up and annual inflation – which remained well into triple digits at 209% in September – has contributed to a deep fall in purchasing power.
“Sales have been dropping a lot, perhaps people come more to buy on a daily basis, small quantities, and you can see the difference,” 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 freeze on beef prices. Beef consumption fell in the first six months of the year to its lowest level in 13 years, according to a report by industry group Ciccra.
“The price of meat has not gone up these months because there is very little consumption. As consumption goes down, sales also go down. And well, it is a bit complicated,” said Gabriel Segovia, a 52-year-old butcher in Buenos Aires.
(Reporting by Horacio Soria; Writing by Lucila Sigal and Brendan O’Boyle; Editing by Christina Fincher)
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