UPDATE 1-Argentina inflation overshoots in October in election blow for Peronists

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(Analyst adds comment, context, graphic)

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Buenos Aires, Nov 11 (Businesshala) – Argentine consumer prices rose 3.5% in October, above analyst estimates, the official statistics agency said on Thursday, in a blow to the Peronist government ahead of Sunday’s midterm elections that largely included Inflation is a major concern for voters.

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The South American country’s rolling 12-month inflation was recorded at 52.1% in the month and 41.8% in the first 10 months of the year.

The Argentine government took steps to reduce inflation by capping prices on household goods. But low confidence in the peso currency and spending to revive growth have countered this.

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“It will be very difficult to contain inflation without solving problems in the exchange and monetary markets,” Roberto Geretto, an economist at Fundcorp, said before the results.

“The only certainty is that the numbers are going to be higher.”

The Argentine peso has slipped to more than $100 per US dollar, and the greenback has more than doubled that amount in alternative markets that have flourished due to tighter capital controls. This gap raises expectations of devaluation and accelerates inflation.

Analysts polled by Businesshala before the data release had predicted a 3.2% monthly increase, with a wide range of forecasts between 2.5% and 3.7% for the month.

Reporting by Jorge Otaola; Written by Adam Jordan; Editing by Cynthia Osterman

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