Argentina’s yearly inflation plunged to 66.9% in January 2025, according to figures from the INDEC statistics bureau released on Friday. The figure is the lowest since July 2022.

Monthly prices rose by 2.4%, a slight increase from January’s 2.2%. Cumulative inflation in 2025 so far has been 4.7%.

Yearly inflation has been consistently decreasing since April 2024: the figure through January 2025 fell below 100% for the first time since early 2023.

The highest monthly increases were in housing, with prices up by 3.7% due to hikes in rent and electricity. They were followed by food and non-alcoholic beverages, with a 3.2% increase driven by meat prices.

The two economic sectors with the lowest increases were household equipment and maintenance (1%) and clothing and footwear (0.4%). The previous month, clothing prices fell by 0.7%.

EcoGo consultancy had forecast a slight monthly increase because of higher meat prices, which weigh heavily on the index. “Beyond that, the disinflation process has continued. The other general goods and services are lower [than last month],” EcoGo director Sebastián Menescaldi told the Herald. 

The consultancy expects prices in March to be “the same or a little lower than in February,” albeit with some seasonal increases in education and services, due to the start of the school year, and in vegetables, due to the recent rainfall.

President Javier Milei was elected with the mandate of decreasing the country’s long-standing inflationary crisis. Price hikes, while still high, have plunged after his administration carried out major cuts and virtually froze the U.S. dollar exchange rate following a major devaluation.

Inflation and poverty in Argentina

However, the government’s measures sparked a recession that left more than half of Argentina’s population in poverty in the first half of 2024.

The government has portrayed this as an initial shock and said that poverty figures fell rapidly in the second half of 2024, pointing to numbers including a simulation by the Argentine Catholic University’s Social Debt Observatory. The authorities attribute this to falling inflation, which means salaries hold their value for longer, and changes to some welfare policies. Milei has said his administration “pulled 10 million Argentines out of poverty.”

However, not all studies agree. A report by the Institute of Socioeconomic Statistics and Trends (IETSE, by its Spanish acronym) found that “social indicators continue to show no significant improvement.” The figures released by the institute, which works with the grocery store association in Córdoba, show that 57% of families surveyed could not access the basic food basket and that, of those that could, 73.2% could only do so with government welfare assistance.

The official poverty figures for the second semester of 2024 will be released on March 31. 

Milei’s program to stop inflation has also been criticized due to its over-reliance on keeping the exchange rate at bay, a move that comes at a huge cost in international reserves.

The government is currently negotiating a new deal with the International Monetary Fund (IMF). Market sources estimate that the deal will bring fresh funds for around US$20 billion. The president wrote in a column those funds would be used “to end the problem of inflation once and for all.”