Argentine inflation: 3.4% a month in January, 29.8% in a year; Macri refuses to publish gov't data.

The Latin American Economic Research Foundation (FIEL), a pro-market Argentine consulting firm, published its inflation estimates for the month of January. Alternative estimates have become the sole source of Argentine inflation data since President Mauricio Macri decreed the suspension of all statistical data releases until at least September.

FIEL reported that inflation in January was 3.4%, with prices rising 29.8% over January 2015 levels. The monthly figure was an improvement over the 4.7% reached in December (the highest in 13 years); but the annual rate continued to rise since November, when it was 22.5% a year.

The minimum value of goods and services needed by a family of four reached 7,441 pesos ($550) in January, of which 4,055 pesos ($300) would be needed for food expenses. The median monthly salary for a full-time private sector worker in Argentina was 14,830 pesos in September (the latest data available).

"January inflation carried over immediately into February, suggesting an inflation rate for the current month of no less than 3%," said FIEL director Juan Luis Bour. The outlook for prices going forward, according to Bour, was no better: "Prices will likely increase by another 50% before an equilibrium between relative prices is achieved." Bour attributed these price pressures to the Macri's administration's reduction of utility rate subsidies as well as the exchange rate devaluation enacted on December 17.

'Shoulder to the wheel.'

Despite the sharp price run-ups since taking office two months ago, President Macri is insisting on wage austerity - and Argentina's large labor union movement is becoming restive. Collective bargaining negotiations for 2016 are set to begin this month; but while labor leaders have proposed average pay hikes of nearly 40%, Macri has refused to endorse anything higher than 20 to 25%. "It's time for labor to put their shoulders to the wheel," the President said.

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