BUENOS AIRES (Reuters) – Argentina will water down a tax hike on liquid fuels, the country’s energy secretariat said on Friday, as it faces a biting recession and President Mauricio Macri seeks to rein in rising prices.

The hike, postponed since early June, will be 3.9%, well below the 11.8% expected based on the usual formula that takes into account inflation in the previous three months.

“The tax is applied on a quarterly basis and would have been increased at the beginning of June, but the Ministry of Finance decided at that time to postpone its implementation for a month,” the ministry said.

The Central Bank of Argentina and Macri, who is seeking re-election in October, are pushing fiscal and monetary reforms to slow down inflation which has been running at around 57.3% over the last 12 months.

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