Argentina’s monthly inflation dropped to 2.7% in October, according to a report by the INDEC statistics bureau published on Tuesday. It’s the lowest consumer price index under President Javier Milei’s administration and the first time since November 2021 that prices increased by less than three points.

Prices have risen 107% in the first 10 months of the year and 193% since October 2023.

Inflation has been consistently going down since December 2023, when prices increased by 25.5% after Milei devalued the Argentine pesos by more than 50%. 

A press release by the Economy Ministry said that Tuesday’s numbers are “consistent with a deepening the disinflation process.”

The sector with the highest monthly increase was the housing and utilities category (5.4%) due to rent, gas, water, and electricity tariff increases. For example, rents in the Greater Buenos Aires area have increased by 9.7%, according to the INDEC. It was followed by 4.4% in the clothing and shoes category, 4.3% in restaurants and hotels, and 3.6% in health (which includes medication costs and healthcare payments).

You may also be interested in: IMF doubts Argentina’s inflation forecast for 2024 and 2025

While inflation is going down, economic activity does not seem to have fully recovered from a glut that started in the last months of Alberto Fernández’s administration. A 118% increase in the U.S. dollar, stopping all public works, lowered tariffs for imported goods as well as virtually freezing public salaries and retiree pensions have contributed to a worsened economic outlook. Poverty figures made a record jump of 11 points in the span of six months.

“The lack of a rebound in consumption remains the main reason for price moderation in the food category,” said a report by the Center of Argentine Economic Politics (CEPA). 

August’s Monthly Economic Activity Estimator, published by the INDEC, was 3.8% below the same month of the previous year and only 0.2% up compared to July. Only farming, fishing, mining, and teaching saw interannual increases, with steep drops in all the other economic sectors. 

However, Milei and his followers have been sharing X posts with the hashtag #SeTerminóLaRecesión (“The recession is over”). Meanwhile, the International Monetary Fund has forecast a 3.5 drop in Argentina’s GDP for 2024.

After December’s devaluation, the Central Bank has been increasing the official U.S. dollar rate by 2% a month, although international reserves are at negative US$5 billion, leading to an “inflation in U.S. dollars.” The outcome is that prices for basic goods are higher in Argentina than in countries with higher minimum wages.

The 2.7% figure was lower than forecasts by banks and consulting firms, as the latest Central Bank survey said they were expecting a 3% inflation rate for October. For November, they are predicting a 2.9% price rise.

After the figure was published, Milei took to X to publish in all caps saying it was a “very bad day for mandrills,” alluding to a homophobic insult he often launches at economists who disagree with his policies.

You may also be interested in: A million Argentine children skip meals each day due to poverty