The country’s inflation has not exceeded 100% for more than three decades, while the value of the Argentine currency is collapsing.
Inflation in Argentina, a South American country, has exceeded 100% for the first time since 1991, according to the government’s latest consumer price index.
The National Statistics and Census Institute (INDEC) has published its February report on Tuesday, showing Argentina’s annual inflation at 102.5% as the country continues to suffer from one of its worst economic crises in decades.
In February alone, inflation rose by 6.6%, with food and beverages identified as the worst hit item category. INDEC attributed the 9.8% increase in food costs to high prices for meat, dairy and egg products.
Latest inflationary jump comes as Argentina faces a historic droughtits worst in nearly 60 years, and wildfires in areas like northern Corrientes province.
The country is a leader soybean exporteralongside the United States and Brazil, as well as other agricultural products such as corn, wheat and other cereals.
But with crops failing in Argentina’s fertile grasslands, known as the pampas, industry experts have lowered the country’s expectations agricultural yields at levels not seen since the turn of the century. High temperatures, thought to be caused by climate change, have beset the country since May 2022.
Argentina has the second largest economy in South America. But for much of the last century, its market was notoriously volatile, with a debt crisis in the 1980s causing chronic hyperinflation throughout that decade.
The inflation crisis peaked in 1989 with rates reaching over 3,000% at times.
Struggling with its spiraling international debt, Argentina struck a controversial deal in 2018 with the International Monetary Fund (IMF) for more than $57 billion in credit – the largest loan package in the fund’s history.
But inflation has been rising since 2018 and the country is struggling to keep pace with its repayment plan. A new $44 billion loan agreement was agreed with the IMF in 2022, to replace the 2018 plan.
On Monday, the IMF announcement he had reached a “staff-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 with Argentina’s economic difficulties and the impact this is having on their cost of living.
” There is nothing left. There is no money. People have nothing, so how do they buy? said Irene Devita, a 74-year-old retiree who does her grocery shopping.
She told Reuters she was recently forced to forgo a planned purchase of tomatoes because the cost of food exceeded her ability to pay.
Another client, Patricia Quiroga, 50, expressed frustration at politicians’ apparent inability to rein in inflation.
“I’m tired, tired, just tired of all this, politicians fighting while people are starving,” she told Reuters. “This can not go on.”
Argentina is expected to hold general elections, including for president, in October.