Government Confirms Indec’s Preparation for New Formula
The government of Javier Milei has confirmed that the National Institute of Statistics and Censos (Indec) is preparing to change the formula used to measure inflation in Argentina. This announcement comes after March’s monthly data closed at 3.7%, the highest since August 2024.
Background on Javier Milei and Relevance
Javier Milei, an Argentine economist and politician, is the current Minister of Production in the interim government led by Juan Manuel de la Sota. Milei is known for his libertarian views and has been a vocal critic of Argentina’s high inflation rates. His government’s decision to revise the inflation calculation methodology reflects his commitment to addressing this pressing economic issue.
Indec’s Progress and Upcoming Changes
During an annual management report presented to Congress, Chief of Staff Guillermo Francos revealed that Indec completed all technical and methodological developments for the new Consumer Price Index (CPI) in March. Francos stated that Indec is now awaiting institutional approvals to launch a campaign for public awareness and education on the new CPI.
Francos also mentioned that Indec continues to conduct technical analyses regarding price stability and ensures compliance with international recommendations. The government emphasizes that any modifications will not be introduced during atypical periods.
Details of the New Inflation Calculation Methodology
The changes involve updating the ENGHO, which is used for monthly price measurements. Currently, 2004 results serve as the reference, but the new implementation will incorporate data from 2018 alongside the existing 2004 information. The revised mechanism will cover 500,000 products, an increase from the current 320,000 prices.
The updated methodology will consider input from 24,000 informants, providing a more accurate reflection of current consumer habits. This change aims to offer a better understanding of Argentina’s inflation rate and its impact on the population.
Key Questions and Answers
- What is the main reason for the change in inflation calculation methodology? The Milei government aims to provide a more accurate reflection of Argentina’s inflation rate by updating the calculation methodology, incorporating newer consumer habits and data.
- Who is Javier Milei, and why is his government’s decision relevant? Javier Milei is an Argentine economist and politician known for his libertarian views and criticism of high inflation rates. His government’s decision to revise the inflation calculation methodology demonstrates his commitment to addressing this economic issue.
- What are the key changes being implemented by Indec? Indec is updating the ENGHO, incorporating data from 2018 alongside existing 2004 information. The new methodology will cover 500,000 products and consider input from 24,000 informants to better reflect current consumer habits.
