Argentina's monthly inflation dropped to 1.5% in May, its lowest level in five years, a positive sign for President Javier Milei's aggressive austerity campaign aimed at reining in runaway prices.
Annual inflation came in at 43.5% in May, the INDEC statistics agency reported Thursday, down from 211% at the end of 2023 but still one of the highest rates in the world.
The monthly rate was down from 2.8% in April.
Milei, a self-declared "anarcho-capitalist," came to power in December 2023, wielding a chainsaw as a symbol of his plan to restore fiscal discipline and rein in inflation.
Last year, Argentina recorded its first budget surplus in a decade thanks to austerity cuts, but the collateral damage was a loss of purchasing power, jobs, and consumer spending.
Milei's government hailed the May figure, which it attributed to a "successful orthodox stabilization plan" that included a recent loosening of exchange controls.
The INDEC said May monthly price rises were boosted mainly by telephone and internet costs (up 4%), restaurants and hotels (3%) and health expenses (2.7%).
The lowest increase was for transport (0.4%), followed by food and non-alcoholic beverages (0.5 %).
The positive numbers will do little to quell the anger of Argentines over their loss in purchasing power, with wages having remained stagnant over many months of high inflation.
"Prices are not dropping; they are rising," Cristian Rodriguez, a 45-year-old logistics employee, told Agence France-Presse (AFP).
"Everything edible is going up," he added.
In April, Argentina received $12 billion as the first disbursement of an International Monetary Fund (IMF) loan worth $20 billion, marking a strong vote of confidence in Milei's economic program.
When the loan deal was announced, the IMF said it was built on "the authorities' impressive early progress in stabilizing the economy, underpinned by a strong fiscal anchor, that is delivering rapid disinflation and a recovery in activity and social indicators."
Success in curbing prices is the result of an austerity program that entailed firing tens of thousands of public sector workers, halving the number of government ministries and vetoing inflation-aligned pension increases.
