Argentina’s poverty rate jumped to 32.3% in the first half of 2026, official data showed Thursday. It is a setback for President Javier Milei a little over a year before he seeks reelection.

The statistics agency INDEC said poverty rose four percentage points from 28.2% in the second half of 2025. Extreme poverty rose from 6.3% to 7.5%.

Roughly 9.7 million people across 31 urban areas lived below the poverty line. Nearly 45% of children under 15 were poor, INDEC said. Household income rose 11.5%, but the basic basket of goods used to set the poverty line increased nearly 20%.

The reversal follows a sharp decline Milei had touted as proof his free-market reforms were working. Poverty hit nearly 53% in early 2024 after his peso devaluation and spending cuts. It then fell to an eight-year low of 28.2% as inflation cooled.

Economists say progress has lost momentum as unemployment edges up and wages lag prices. A Catholic University estimate suggests poverty could reach 35% by year end.