We already knew that August was going to have a low inflation rate — ministers said they expected it to be less than 1 percent. Now government sources tell La Nación the government is estimating the inflation rate for last month was actually close to zero. Since the price of services are a component when calculating inflation, the fact that the gas hikes did not come into effect means that the increase was not included in the overall inflation rate. And while we’re still getting used to the idea that maybe there was no inflation, another word has also been making the rounds lately: deflation. Thus, in the same way that August’s inflation rate may be a lot lower than expected (the same goes for September), the inflation rate for October will probably be back to a more normal rate.

Source: The Bubble September 08, 2016 21:22 UTC