.jpg&w=1440&q=75)
Argentine families are having to earn ever more to stay above the poverty line, as the cost of essentials outruns headline inflation and threatens to unwind one of the signature achievements of President Javier Milei’s austerity drive.
A family of four needed ARS 1,632,505 (about $1,056) in September to avoid being classified as poor, according to the latest figures from the National Institute of Statistics and Censuses (Indec). At least ARS 738,690 ($478) was required to cover basic food needs and avoid indigence.
The total basic basket, which measures the cost of essential goods and services, rose 24.7% between January and September, while the basic food basket climbed 25.3%. Both outpaced cumulative inflation of 23.6% over the same period, after consumer prices rose 1.9% in September, up from 1.7% in August.
The gap was wider on an annual basis. The basic food basket rose 38.7% from September 2025 and the total basic basket 40%, against annual inflation of 33.4%.
The divergence matters because the two baskets underpin Argentina’s official measures of deprivation. The basic food basket estimates the minimum expenditure needed to meet essential food requirements, while the total basic basket adds other goods and services. Indec uses the latter to set the poverty threshold and the former to determine the indigence line.
The figures highlight the pressure on household purchasing power, particularly among lower-income families, whose spending is concentrated more heavily on essential products.
Julián Neufeld, an economist at the Fundación Libertad y Progreso, said prices for goods that make up a larger share of poorer households’ spending had risen faster than the overall price index, Perfil reported.
“The prices that weigh most heavily on lower-income households have been rising above the general index, and that erodes purchasing power precisely in the most exposed segment,” Neufeld said.
That mismatch has direct consequences for incomes, he explained. Wages are adjusted in line with the consumer price index where collective bargaining agreements allow, while poverty and indigence thresholds are calculated from the basic baskets. A significant gap between the two can therefore push more people below those thresholds.
Neufeld also pointed to the first half of 2026, when higher meat and fuel prices fed inflationary pressure. Because both carry substantial weight in the basic baskets, their faster price growth pushed up the cost of essential consumption and contributed to more households falling below the poverty line, he said.
Reversal of fortune
The squeeze is a heavy blow for a government that has made falling poverty central to its political case. When Milei, a self-described "anarcho-libertarian," took office in December 2023, annual inflation was running at triple-digit rates. As price growth slowed, poverty fell from 52.9% of the population in the first half of 2024 to 28.2% in the second half of 2025, its lowest level since 2018.
That trend has now reversed. Poverty rose 4.1 percentage points to 32.3% in the first half of 2026, Indec said in September, taking the number of poor Argentines to roughly 15 million, about 2 million more than six months earlier. Extreme poverty climbed to 7.5% from 6.3%. Over that period the total basic basket rose 19.6%, against consumer inflation of 16.8%, with meat prices a key driver.
The data landed hours after Milei told an audience in New York that his administration had lifted 14mn people out of poverty. He later dismissed the figures as “an old snapshot.”
Wages have struggled to keep pace. Registered salaries fell in real terms for seven consecutive months to March and were 9.2% below their level when Milei took office, according to Indec data. The strain is visible on the dinner table: beef consumption, a marker of Argentine living standards, fell to a two-decade low of 44.5kg per person in the year to April, according to the farm-sector think tank FADA, as prices rose more than 60% over 12 months.
Stalling recovery
The pressure on households is compounded by a weakening economy. Gross domestic product contracted 0.6% from the previous quarter in the April to June period, as private consumption fell 2.4% and investment slipped, leaving exports as the only main component of demand to grow, El Cronista reported. Economic activity then dropped 2.9% month on month in July, the steepest decline since April 2020. Unemployment rose to 7.9%, the highest of Milei’s term, while informal employment reached 45%.
The IMF this week cut its 2026 growth forecast for Argentina to 2.1% from 3.5% and raised its inflation projection to 32.5% from 30.4%. Meanwhile, Argentina’s country risk premium climbed above 640 basis points in late September, its highest level of the year, from about 400 in July.
Milei has flatly rejected suggestions that the country is in recession. “There is no recession,” he said in a television interview in late September, describing the situation instead as a slowdown in the pace of expansion.
Still, analysts expect the relationship between basket costs and headline inflation to remain a decisive variable. Andrés Schipani of the think tank Fundar has singled it out, alongside growing job precariousness, as the key factor to watch for poverty levels, Clarín reported.
The September figures show both baskets rising faster than overall inflation during the first nine months of the year and over the past 12 months, lifting the income families need to clear the official thresholds.