Argentina's Buenos Aires inflation vaults higher in April amid subsidy cuts

martes 10 de mayo de 2016 15:34 GYT

By Walter Bianchi

BUENOS AIRES May 10 (Reuters) - Monthly inflation in Argentina's main population center of Buenos Aires approached 7 percent in April, according to private estimates used as a reference while the country suspends official data releases and revamps its discredited statistics agency.

It would be the highest rate of inflation since the country's 2001-02 financial meltdown that sparked riots in the capital and threw millions of middle-class Argentines into poverty.

The principal cause of the spike in consumer prices last month was the lifting of energy and transportation subsidies in the greater Buenos Aires region by the country's new President Mauricio Macri.

"April inflation was the highest in 14 years, due to the elimination of subsidies, which increased utility prices," Gabriel Zelpo, an economist at local consultancy Elypsis, said on Tuesday. The firm estimates inflation for the month at 6.9 percent compared with 3.1 percent in March.

Other analysts consulted by Reuters estimated April inflation at between 6 percent to 7 percent.

The government says the surge in consumer prices was temporary but it forecasts inflation for full-year 2016 at 25 percent, a projection that many analysts call optimistic.

"May inflation will be half of what it was in April, when we saw the impact of lifting the subsidies," Interior Minister Rogelio Frigerio told local radio. "In June and July, we will be at 2 percent."

Macri, elected in November on promises of improving investor confidence in Latin America's No. 3 economy, has ordered a revamp of the Indec statistics agency after years of issuing economic indicators widely rejected as inaccurate by market watchers.   Continuación...