What is the most likely diagnosis for a 2-day-old neonate with pustules and erythema on the face, trunk, and upper arms?

The presentation of pustules and erythema in a 2-day-old neonate is highly indicative of erythema toxicum neonatorum. This condition is quite common in newborns and typically presents within the first week of life. It is characterized by the sudden appearance of small pustules on an erythematous base, which can be mistaken for other skin conditions.

Erythema toxicum neonatorum follows a self-limiting course, usually resolving within a few days to weeks without treatment. The lesions can appear on various parts of the body, including the face, trunk, and upper arms, which matches the description in the question.

Neonatal acne generally arises later, usually around two to four weeks of age, and presents as comedones and inflammatory papules primarily on the face. Contact dermatitis would require an identifiable irritant or allergen and is less common in such young infants. Folliculitis, while possible, is less likely without a history of infection or associated symptoms such as fever.

Given the timing of onset, the age of the infant, and the appearance of the lesions, erythema toxicum neonatorum is the most appropriate diagnosis in this case.