Argentina’s monthly inflation rate in May was likely the lowest since 2022 amid a tough austerity drive by libertarian President Javier Milei, but with annual inflation still near 300% many Argentines say they can’t yet feel the benefit as food prices outstrip salaries.

Annual inflation is still the highest in the world, even as the monthly rate has slowed, with rising food, utilities, and transportation costs making the minimum monthly wage in Argentina of 234,315 pesos ($260) feel insufficient.

“I still don’t understand how inflation can be going down,” said Silvia Castro, a 65-year-old retiree shopping for her groceries at a market on the outskirts of Buenos Aires.

“Taxes are very expensive, services and gasoline are expensive, insurance is expensive, the social work (health service) that was meant to go down is the same or has risen.”

Argentina’s government touts its success taming inflation with tough measures to reduce central bank money printing, focus on rebuilding reserves and cut spending. But it faces a challenge to keep voters on-side with the economy stalling and poverty levels rising.

The monthly inflation rate is set to have fallen for a fifth straight month in May to likely under 5%, down from a peak over 25% in December when Milei took office and sharply devalued the local peso currency.

But Laura Basualdo, a 53-year-old merchant, said many people were struggling to buy things as their earning power had been eroded by constantly high inflation.

“I’m a merchant and I often see the customer on the other side who, clearly, if my prices don’t work for them, they go out to look for other offers,” she said.

“We all have to shop around today. It’s terrible, constantly the money in our pockets gets lighter, less and less each time. Nowadays it feels like eating is a luxury.”

(Reuters)