Milei’s Poverty Bet Falters as the Rate Hits 32.3 Percent

Argentina’s urban poverty rate rose to 32.3 percent in the first half of 2026, the national statistics institute INDEC said on September 24. That is 4.1 points above the 28.2 percent reading for the second half of 2025, which had been the lowest print since early 2018.

President Javier Milei sold that earlier drop as proof that shock therapy worked. The new figure tests the unpaid half of the same wager: that once inflation broke, jobs and real pay would keep poverty down through a 2027 re-election fight.

INDEC Counts 9.7 Million Urban Poor in the First Half

The first-half 2026 poverty report covers 31 urban areas and 30.1 million people. In that universe, 9.7 million people lived below the poverty line and 2.2 million could not cover a basic food basket. Poor households numbered 2,498,000, or 24.4 percent of homes; 5.6 percent of households were in extreme poverty.

Three straight half-years of decline ended with this print. Extreme poverty among people rose from 6.3 percent to 7.5 percent. Cities of 500,000 or more saw a 3.9 point rise; smaller urban areas rose 4.9 points. Against the same half of 2025, when the rate was 31.6 percent, INDEC said the change was not statistically significant.

THE POVERTY SERIES UNDER MILEI

The 31-area count of poor people rose from 8.5 million in late 2025 to 9.7 million, a gain of 1.2 million. INDEC will publish the second-half 2026 reading on March 31, 2027.

#DatoINDEC
EPH en 31 aglomerados urbanos: ¿cuál fue la incidencia de la pobreza en las personas durante el 1° semestre de 2026 en cada región estadística? https://t.co/AYeQnndT2Q pic.twitter.com/YOesBC1rD4

— INDEC Argentina (@INDECArgentina) September 24, 2026

Why Household Incomes Lost to the Basic Basket

INDEC compares income with the total basic basket, the food-plus-essentials line known as the CBT, and with the food-only CBA. From the second half of 2025 to the first half of 2026, income per person in the family rose 11.5 percent. The food basket rose 21.4 percent and the total basket rose 19.6 percent. Pay grew. The lines used to classify a household as poor grew faster, so both rates moved up.

INCOMES VERSUS THE BASKETS

• Income per person: Average family income per capita rose 11.5 percent in the first half of 2026.
• Food basket (CBA): The indigencia line rose 21.4 percent over the same six months.
• Total basket (CBT): The poverty line rose 19.6 percent, about eight points more than income.
• The gap in poor homes: Average family income there was 922,755 pesos against a 1,440,395 peso basket, a 35.9 percent shortfall, wider than in late 2025.

That mix is the inverse of the 2025 decline. In the second half of 2025, total family income rose 18.3 percent while the two baskets rose 11.9 and 11.3 percent, and poverty fell. The Observatorio de la Deuda Social Argentina at the Catholic University of Argentina said food and basic services had risen more slowly than general prices through much of 2024 and 2025, then that gap reversed late last year. Tariffs, rents and other bills that are hard to cut grew faster than many family incomes, the observatory said, leaving less money for food even when a paycheck still arrived.

Caputo Marks the Score From the 2024 Peak

Economy minister Luis Caputo answered the new print on X by stressing the drop from Milei’s first year, not the rebound from last winter. Poverty, he wrote, had gone from 52.9 percent in the first half of 2024 to 32.3 percent, and extreme poverty from 18.1 percent to 7.5 percent, even after the latest 4.1 point and 1.2 point rises.

That 2024 peak followed the peso devaluation and spending cuts that opened the term. From that high, the rate is still down 20.6 points. From the second half of 2023, the last full print before he took office in December 2023, it is down 9.4 points. The argument on the day of the release was which of those starting lines counts as the bet that was placed.

A modest increase in poverty would not undo the large decline seen under Milei, but it would suggest that the easier part of the improvement has run its course.

Nicholas Watson, managing director for Latin America, Teneo

When INDEC printed 28.2 percent for late 2025, Caputo called it the lowest in more than seven years. He tied that low to growth, disinflation and social payments sent without brokers. The first-half 2026 figure does not erase the fall from 52.9 percent. It does end the stretch in which falling inflation did most of the work.

Unemployment at 7.9 Percent Caps the Recovery

The jobless rate in the 31 urban areas was 7.9 percent in the second quarter of 2026, INDEC said, up from 7.8 percent in the first quarter and from 6.6 percent in the third quarter of 2025. Activity rose to 48.9 percent of the population and employment to 45.0 percent. Underemployment was 11.5 percent. Informal work was 1.0 point higher than a year earlier, a change INDEC flagged as statistically meaningful, while the year-on-year shifts in employment and unemployment were not.

Gran Rosario posted 11.5 percent jobless and Gran Córdoba 10.5 percent. Interior urban areas saw a rise from 6.8 to 7.6 percent. Women were at 8.4 percent and men at 7.5 percent; among people aged 14 to 29 the rates were 17.1 percent for women and 14.1 percent for men.

Pay still sits below the level recorded when Milei took office. Centro CEPA, in a 1,000-day review of the term, put private registered real wages in June 2026 3.6 percent below November 2023. National public wages were 37.0 percent lower in real terms on the same comparison, with provincial public pay down 9.7 percent. Average salaries remain below their December 2023 purchasing power. Without faster hiring and a real raise, the poverty math that worked in 2025 does not repeat.

Child Poverty Reaches 44.5 Percent

Age cuts through the average. Of people aged 0 to 14, 44.5 percent lived in poor households in the first half of 2026, up from 41.3 percent in late 2025, and 10.8 percent were in extreme poverty. The share was 36.9 percent at ages 15 to 29, 28.8 percent at 30 to 64, and 14.8 percent at 65 and over.

WHO FELL BELOW THE LINE

• Young children: 44.5 percent of people aged 0 to 14 were in poor homes, and 10.8 percent could not cover food.
• Young adults: 36.9 percent of people aged 15 to 29 were below the poverty line.
• Working ages: 28.8 percent of people aged 30 to 64 were poor, closest to the 32.3 percent average.
• Older adults: 14.8 percent of people 65 and over lived below the line, still well above the 9.7 percent share in late 2025.

The map is uneven too. The Northeast stood at 41.5 percent poor and 10.5 percent in extreme poverty. Patagonia was the least poor region at 28.4 percent. Greater Buenos Aires, which dominates the sample, was 32.1 percent, almost identical to the national urban rate.

POVERTY BY REGION, FIRST HALF 2026

Transfers still hold a floor under the worst cases. The observatory estimates that without the Universal Child Allowance, other cash programs and non-contributory pensions, extreme poverty would sit around 14 to 15 percent rather than 7.5 percent. In March 2026 those child and food payments covered about 39 percent of the food basket in a two-adult, two-adolescent home, and a much smaller share of the total basket.

A 35 Percent Year-End Rate Would Confirm the Turn

Agustín Salvia, who leads the UCA observatory, has been reading INDEC’s microdata on a quarterly clock that the official semester series smooths over. That clock turned up before the 32.3 percent headline.

UCA’S QUARTERLY TURN

1. Third quarter of 2025: Poverty among people falls to 26.9 percent, the low of the disinflation run.
2. Fourth quarter of 2025: The rate rises to 29.9 percent as relative prices stop helping.
3. First quarter of 2026: It holds near 30 percent.
4. Second quarter of 2026: It jumps to 34.6 percent, pulling the official semester average to 32.3 percent.

Salvia said 400,000 to 450,000 people have been crossing into poverty in each of the past four quarters, and that the rate could reach 35 percent by the end of 2026. The observatory also argues that a structural core near 30 percent remains even after the 2024-25 drop, with extreme poverty stuck near 7 percent. If the second-quarter 34.6 percent reading is the new path rather than a blip, the year-end figure he flags would sit above the first-half official rate and above the 31.6 percent recorded in the first half of 2025.

The 2027 Constituency Is Already Drifting

Milei has to defend this record in a 2027 election, and the voters who needed the inflation crash most are the ones peeling off. AtlasIntel, in a national sample of 2,193 people taken from August 30 to September 3, found disapproval among respondents earning under 630,000 pesos a month (about $650) at nearly 70 percent, with approval in that band below 30 percent. A year earlier those lower-income figures were 57 percent disapproval and 37 percent approval.

The 32.3 percent rate is still far below the 52.9 percent shock of 2024, and still below the 41.7 percent print Milei inherited. The easier half of his wager, the one that ran through a crashing inflation rate, is the half already cashed. What remains is slower and more political: real wages that have not recouped late 2023, a 7.9 percent jobless rate, and a child poverty share at 44.5 percent. Those are the terms on which the next official print, and the 2027 vote, will mark the rest of the bet.