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Original article: La inflación le estalla a Milei: 3,4% en marzo y 32,6% interanual

Argentina’s Inflation Crisis: March Sees a Surge to 3.4% and 32.6% Year-on-Year

The dire predictions for Javier Milei‘s government have come true, as inflation in Argentina reached 3.4% in March, marking a staggering annual increase of 32.6%. This figure represents the highest rate since March 2025, when it was recorded at 3.7%.

According to a report from the National Institute of Statistics and Census (INDEC), this figure reflects a rise of 0.5 percentage points in the Consumer Price Index (CPI), compared to the 2.9% registered in February.

INDEC also confirmed that inflation has accelerated for the tenth consecutive month in the southern nation.

The results are a setback for Milei’s administration, which has attempted to justify cuts in its fiscal and monetary adjustment plan by aiming to lower inflation levels. However, the goal of finishing 2026 with an annual inflation rate of 10%, as projected in the official budget, appears unachievable, as the CPI has already risen by 9.4% in just the first quarter.

Prior to the report’s release, Economy Minister Luis Caputo had tried to soften the blow by predicting that March’s inflation would exceed 3% due to a “shock” in oil prices, and assured that “a process of disinflation and growth will begin in April.”

Media outlets like Página/12 pointed out that far from being an isolated phenomenon or one attributable to factors such as the U.S. and Israel’s war against Iran and its effects on the energy market; the increase is directly linked to the economic policies implemented by the libertarian government.

The adjustment plan for stabilization—anchored in wage and currency controls amidst a deep consumer crisis—has failed to bring prices closer to the promised “zero inflation” target of such programs. In fact, Argentina has experienced ten consecutive months of widespread price increases, a trend the Casa Rosada cannot conceal.

Milei Refuses to Accept Responsibility, Blames Opposition

Amid this alarming economic scenario, Milei delivered a speech before the American Chamber of Commerce (AMCHAM), where instead of accepting accountability, he claimed that the continued rise in inflation is due to the policies enacted by the opposition.

The President stated, “Argentina had to face two shocks of gigantic proportions.” He explained that the first shock was that “Congress passed over 40 laws trying to break the fiscal equilibrium. They did not succeed.”

In this same vein, the far-right leader claimed that the country “faced a major currency run,” even after La Libertad Avanza won the elections.

“At any moment in history, if something like this had happened, the country would have blown up—said the President—but not only did it not explode, we received strong support at the polls. The people know about the efforts being made and don’t want to return to the past.”

However, analysis of the numbers reveals a reality far more complex than what Milei aims to portray, as he stated, “this is not inflation strictly speaking; it’s that the level of prices jumped.”

The price increase recorded in March in Argentina, referenced by the libertarian, has at least two peculiarities. The first is that the Food category increased by exactly the same rate as general inflation: 3.4%, significantly impacted by beef prices. But the most striking is that regulated Services—including fuel—rose by 5.1%.

“If inflation had been measured with the CPI that the government refused to implement (which weighted services more than goods), it would have been even higher than 3.45,” Página/12 reported.

The cited outlet suggested that regarding tariffs, the government is playing both sides: on one hand, they froze fuel prices for 45 days to prevent a further spike; and on the other, Milei himself admitted that service companies are in the process of price restructuring, anticipating further increases beyond the CPI in the coming months.

The second peculiarity is equally concerning: core inflation—excluding regulated or seasonal goods and services—stood at 3.2% in March. This figure, far from being a relief, indicates that the seasonally adjusted perspective does not suggest significant deceleration for April. In fact, consulting firms that have already measured the first half of the fourth month estimate inflation around 2.5 or 2.6%. A figure still high for any standard of a stabilization plan that promised rapid price decreases.

Price Increases in Education, Transport, and Food

According to the INDEC report, the division with the highest increase in March was Education, with an increase of 12.1%, although this aligns with the start of the school year, Página/12 warned that “the increase in this category was much greater than the average.”

In second place was Transport, with an increase of 4.1%, driven by increases in fuel, tariffs, and fares.

The impact of Food and non-alcoholic beverages was also significant in the overall results, primarily due to the rise in meats and derivatives, where increases exceeded 5% across all regions.

In contrast, the smallest changes in March were recorded in Equipment and house maintenance (1.3%) and Goods and various services (1.7%).

IMF Revises and Increases Inflation Forecasts for Argentina

The economic outlook for Milei’s administration is increasingly precarious, coinciding with the release of CPI data. Petya Koeva Brooks, Deputy Director of the Research Department at the International Monetary Fund (IMF), addressed changes in inflation and growth forecasts for Argentina, noting that these revisions are not solely due to the Western Asia war, but also to “a weakening in economic activity and the negative impact of inflation on real incomes.”

In other words, the institution acknowledges that the purchasing power of Argentinians is diminishing. While the annual inflation for Argentina was projected to be just over 16% in January, now, following a series of adverse data, it has been revised to over 30%. A significant adjustment that highlights the failure of Milei’s forecasts.

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