Argentina's monthly inflation edges up as key midterm vote draws near

BUENOS AIRES, Oct 14 (Reuters) - Argentina's monthly inflation edged up in September but remained a touch below analysts' forecasts, data showed on Tuesday.

Consumer prices are being closely scrutinized in light of recent exchange-rate instability and ahead of a key midterm vote at the end of October in which the party of Argentine President Javier Milei hopes to strengthen its minority presence in Congress.

The data came just as Milei was meeting with U.S. President Donald Trump following the announcement of a $20 billion currency swap with Argentina's central bank. Trump indicated that U.S. support would hinge on Milei's party winning the upcoming vote.

Monthly inflation sped up in September to 2.1% from the 1.9% recorded a month earlier, data from Argentina's INDEC statistics agency showed, landing just a touch below analysts' 2.2% forecast, while 12-month inflation hit 31.8%.

This marked a slowdown from the 33.6% recorded in August and was in line with analysts' 31.8% rate prediction.

Rent, utilities and education led price hikes at 3.1%, followed closely by transport at 3% and healthcare at 2.3%.

The annual inflation rate is the country's lowest in more than seven years, consolidating the biggest single success of Milei's government, which otherwise has been dealt a string of painful political defeats.

Early this month, analysts raised their inflation forecast for the end of this year to 29.8% and trimmed their GDP growth forecast to 3.9%, as high interest rates and weaker demand resulting from spending cuts weighed on economic growth.

After the October 26 vote, many analysts expect Milei's government to stop intervening to bolster the volatile peso and instead let it trade more freely.

At Milei's meeting with Trump, the U.S. president said the U.S. would not "waste our time" with Argentina if Milei's party does not win the midterms.

"If he doesn't win, we're gone," he said.

Argentina's main stock index .MERV, which began the session in positive territory, reversed course and fell more than 2% during the meeting.

A local election in the country's most populous province of Buenos Aires last month dealt a resounding defeat to Milei's party, as voters sided with the socially focused opposition over Milei's strict austerity.