ARGENTINA is currently facing one of the highest rates of inflation in the world with the country’s official statistics agency confirming on May 12 that prices had surged by 109% year-on-year in April.
This is the highest in over 30 years for the South American country.
And in order to tackle soaring prices, Argentina’s Central Bank raised interest rates by 6 percentage points to 97% on Monday.
Currently, Venezuela and Zimbabwe are the only 2 countries experiencing higher inflation than Argentina with 400% and 172.2% respectively, according to data from the International Monetary Fund (IMF).
In a statement on Monday, the Central Bank also said that it is hoping the rate hike will incentivize investments in the country’s currency.
It can be recalled that the economy of Argentina descended into a crisis in 2018, with the peso collapsing against the dollar and foreign debt obligations ballooning to unsustainable levels.
“The feeling is that the government is completely losing it against inflation,” said Miguel Kiguel, Financial Adviser, Central Bank of Argentina.
And it is expected that the Argentinian government will also be announcing additional measures to tackle the country’s current economic turmoil ahead of October’s general election.
