Key Takeaways
- Inflation in the City of Buenos Aires surged to 3% in March, up from 2.6% in February, primarily due to increases in regulated prices like fuel, electricity, water, and public transportation fares.
- The cumulative inflation for the first quarter of the year reached 8.9%, with an annual rate standing at 32.1% in Buenos Aires.
- While regulated prices and education saw significant increases, seasonal items like fruits and vegetables, as well as tourism packages, experienced price drops, helping to moderate the overall inflation rate.
Inflation in the City of Buenos Aires accelerated to 3% in March, exceeding February’s 2.6% and aligning with private sector estimates. This uptick is largely attributed to significant price hikes in essential services and goods, including fuels, public utility tariffs (electricity and water), urban bus fares, and private education fees, which saw the largest monthly increase.
The March Consumer Price Index (CPI) for the city represents a 0.4 percentage point increase compared to the previous month. This brought the cumulative inflation for the first quarter of the year to 8.9%. On an annual basis, the cost of living in Buenos Aires has risen by 32.1%. National inflation data from INDEC is expected on April 14.
A substantial portion of March’s inflation stemmed from a 6.5% average increase in regulated prices. This was partially offset by a 4.5% decrease in seasonal items. Education, in particular, experienced an 8.6% rise due to the start of the academic year, making it the segment with the highest adjustment in March. Core inflation, which excludes regulated and seasonal items, stood at 2.7%, a decrease of 0.4 percentage points from February.
The housing, water, electricity, gas, and other fuels category saw an average increase of 3.2% (37.5% year-on-year), contributing 0.65 percentage points to the month’s inflation. This was driven by higher electricity and water bills, as well as increased costs for building maintenance and rent.
Transport was another significant contributor, with a 6% monthly increase (41.3% year-on-year), explaining another 0.65 percentage points of the total inflation. This rise was due to higher fuel prices for vehicles and increased urban bus fares.
Food and beverages experienced an average increase of 2.6% (29.1% year-on-year), showing a slight deceleration from February. Meat and its derivatives saw a 6.5% price increase, while milk, dairy products, and eggs rose by 2.1%. However, prices for vegetables, tubers, and legumes fell by 3.3%, and fruits decreased by 1.8%. Combined, transport, housing, and food accounted for nearly two-thirds of the cost of living increase in March.
The education sector’s 8.6% surge (32.7% annually) explained 0.42 percentage points of the March inflation, primarily due to private school tuition hikes at the start of the school year. Clothing and footwear also saw above-average increases of 3.8% (13.4% annually) due to seasonal changes.
Segments with inflation below the average included recreation and culture (0.7%), restaurants and hotels (0.4%), information and communication (1.9%), insurance and financial services (0.5%), and personal care and social protection (1.7%).
Goods as a whole increased by an average of 2.8%, while services rose by 3.1%. This divergence has been noted by economists, with some suggesting it influenced government decisions regarding the methodology for calculating the national inflation index. Private sector forecasts for national inflation in March largely hovered around 3%.
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