BUENOS AIRES: After years of masking inflation, Argentina's government launched a new index Thursday that showed a sky-high 3.7 percent rise in prices in January alone.
The new index could bring the country closer to resolving a festering dispute that has strained relations between the government, facing difficult financial challenges, and the International Monetary Fund, the global crisis lender.
Released by Economy Minister Axel Kicillof, the new data marked the first time in years that official statistics came close to private sector estimates of inflation, which many analysts have relied on.
Over the past two years, independent economists have put annual inflation at more than 25 percent, compared to the government's estimate of around 10 percent.
"This new index represents an unprecedented change in Argentina because it is qualitatively and quantitatively distinct from the previous one, and it covers the whole nation," said Kicillof.
He said the new index was developed with the help of experts from Spain, Italy, and Russia "as well as specialists from the IMF."
Relations between Argentina and the IMF have been distant since 2006, when Buenos Aires paid off outstanding debt to the Fund and then stopped allowing it to conduct annual reviews of the economy.
In 2012 the IMF warned Argentina over its failure to provide regular data on inflation and economic growth that met the Fund's standards, as required of IMF members.
After there was no movement on the issue, in February 2013 the Fund took the unprecedented step of censuring Argentina and gave it until December last year to meet its demands or face possibly tougher action.
Noting that the government was working on the issue, the Fund extended the deadline in December, giving Buenos Aires until the end of March 2014 to issue a new national consumer price index and new GDP estimates.
On Thursday, the Fund cautiously recognized the new price index, while declining to say whether it satisfied Fund requirements.
"We take note of the launch of Argentina's new consumer price index today," said spokesman Gerry Rice in a statement.
The release of the data, he said, "was a specified action in the IMF Executive Board's December 2013 decision."
He said the IMF executive board would review the issue, without giving a date.
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