Argentina Saw Prices Almost Double Last Year

The price of everyday goods in Argentina has almost doubled in the last year as its annual inflation rate reached its highest level in over three decades.

Official data reveals that consumer prices leapt by 94.8% in the 12 months to the end of December 2022. Inflation has not increased at such a rapid pace in the country since 1991.

Argentina's central bank hiked its primary interest rate to 75% in September as it tried to control the skyrocketing cost of living. The South American country’s monthly inflation stood at 5.1% in December.

The monthly rate, although high, is a partial win for the government of President Alberto Fernandez as the comparable figure for July stood at 7.4%. There were real fears among policymakers that the annual rate would reach three digits by the end of 2022.

The rise in the price of goods was keenly felt during the recent December holiday season, as restaurant meals, hotel accommodations, alcoholic drinks and tobacco all increased by more than 7%.

Like many countries, Argentina has been affected by the rise in the cost of commodities like energy, which is linked to the war in Ukraine. Argentina’s central bank also routinely printed new money last year, exacerbating attempts to reduce inflation.

In December, the IMF approved another $6 billion bailout package for South America's second-largest economy as new Finance Minister Sergio Massa’s strong measures to reduce runaway inflation take hold.