The country’s inflation rate has not risen above 100 percent in more than three decades as the value of Argentina’s currency plummets.
Inflation in the South American country of Argentina has risen above 100 percent for the first time since 1991, according to the government’s latest consumer price index.
This has been announced by the National Institute of Statistics and Census (INDEC). February report on Tuesday, setting Argentina’s annual inflation rate at 102.5 percent as the country continues to suffer one of its worst economic crises in decades.
Inflation rose 6.6 percent in February alone, with food and beverages identified as the most affected category. INDEC attributed the 9.8 percent increase in food costs to high prices for meat, dairy and egg products.
The latest inflationary jump comes as Argentina struggles with a historic drought, the worst in nearly 60 years, and wildfires in areas such as the northern province of Corrientes.
Children play in a plastic swimming pool in Buenos Aires on March 14 as Argentina suffers a major heat wave (Victor R. Caivano/AP Photo)
The country is a leading exporter of soybeans, alongside the United States and Brazil, as well as other agricultural products such as corn, wheat and other grains.
But with crop failures in Argentina’s fertile grasslands known as the Pampas, industry experts have lowered the country’s expected agricultural yields to levels not seen since the turn of the century. Since May 2022, the country has been plagued by high temperatures, believed to be caused by climate change.
Argentina has the second largest economy in South America. But for much of the last century, the market was notoriously volatile, with a debt crisis in the 1980s fueling chronic hyperinflation throughout that decade.
The inflation crisis peaked in 1989 with over 3,000 percent at certain points.
The value of Argentina’s currency, the peso, has fallen in the face of rising inflation (File: Agustin Marcarian/Reuters)
Struggling with its burgeoning international debt, Argentina struck a controversial deal with the International Monetary Fund (IMF) in 2018 for more than $57 billion in credit – the largest loan package in the fund’s history.
But inflation has risen since 2018 and the country is struggling to keep up with its repayment plan. In 2022, a new $44 billion loan deal was reached with the IMF, replacing the 2018 plan.
On Monday, the IMF announced it had reached a “personnel-level agreement” to ease the country’s economic targets under the new debt plan, citing “the challenges of an increasingly severe drought”.
Speaking to Reuters news agency, shoppers on the outskirts of the capital Buenos Aires expressed frustration at Argentina’s economic problems and the toll it was taking on their living costs.
‘There’s just nothing left. There’s no money. People have nothing, so how do they buy?” said Irene Devita, a 74-year-old retiree who does grocery shopping.
She told Reuters she was recently forced to cancel a planned tomato purchase because food costs were beyond her means.
Another client, 50-year-old Patricia Quiroga, expressed her frustration with politicians’ apparent inability to curb inflation.
“I’m tired, tired, just tired of all this, of the politicians fighting while the people are starving,” she told Reuters. “This can’t go on like this any longer.”
Argentina will hold general elections in October, including for the presidency.