INFLATION CONTINUES TO SLOW, UNEMPLOYMENT DROPS

The government’s national statistics agency, INDEC, says consumer prices rose 1.4 percent in August, posting further evidence that inflation is gradually slowing.

That number marked a 0.3 percent drop when compared to July’s rate of 1.7 percent and though inflation seems to be slowing, it means the 12-month annual figure is likely to exceed the government’s upper target of 17 percent. At present, accumulated inflation for the eight months of the year that have passed totals 15.4 percent.

The Central Bank previously set its national inflation target at between 12 and 17 percent for the year, though most analysts thought the final figure would exceed those hopes.

August’s figure was led by consumer price increases in the health industry (+2.5 percent rise), living expenses (+ 2.2 percent) and food (+2.1 percent).

President Mauricio Macri’s government received another welcome boost this week with the news that unemployment in Argentina fell to 8.7 percent in the second quarter of 2017, dropping from 9.2 percent in the first quarter.

The figures were issued by the INDEC national statistics agency on Thursday. By way of comparison, in the second quarter of 2016 unemployment officially stood at 9.3 percent.

Despite the fall in unemployment, the “economically active” population fell to 12.48 million, down from 12.50 million in the same period a year previous.

In other economic news, Finance Minister Luis Caputo said on Monday that the Inter-American Development Bank (IADB) will probably lend Argentina more money than initially inticipated.

“I dare say that in 2019 as well the (IADB’s) floor will be another $2.3 billion,” Caputo said, saying that total financing from the institution’s private arms to firms will reach US$10 billion by the end of 2019, above previous expectations of around US$6 billion.

IADB President Luis Moreno confirmed those figures at a joint press conference during a visit to the capital. The IADB and World Bank has increased lending after the Macri administration settled its long-running dispute with holdout creditors last year.

The Finance Ministry said on Wednesday it had also refinanced US$1 billion in maturing treasury notes, including US$600 million in 182-day notes expiring in March 2018, after receiving requests totalling US$2.6 billion for that issuance and additional 378-day notes expiring in September 2018.