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Argentina’s cost-of-living crisis is worst in 30 years as inflation rises above 100%


People in Argentina can’t afford even basic groceries as the country’s inflation skyrocketed by more than 100 percent – its worst record in 30 years.

This means Argentines are paying more than double for essential items compared to last year and with much of the country’s population already living in poverty, citizens are further battered by the fastest price increase since 1991.

According to government data, 12-month inflation rose to a whopping 102.5 percent in the second month of the year.

By comparison, Australia’s annual inflation rate is 7.8 percent.

The Argentine government is trying to deal with the increases by capping the prices of food and other products as it tries to stay in power with elections looming later this year.

But it also struggles with a higher-than-expected 6.6 percent monthly increase in the consumer price index (CPI) and a 13.1 percent increase year-to-date.

Food and drink became even more expensive with prices rising by 9.8 percent in February compared to January, especially for dairy and eggs.

Meat, in particular, was up as much as 20 percent in just a month after adverse weather conditions including a prolonged heat wave, wildfires and a historic drought — the worst in 60 years — hit livestock and crops, according to the local news outlet. ambition.

As a result, Argentines suffer from one of the highest inflation rates in the world – after Zimbabwe, Lebanon, Venezuela and Syria – driving the cost of living soaring.

Retired Irene Devita, 74, checked prices at a market exchange in San Fernando on the outskirts of Buenos Aires as costs fluctuate weekly.

“There’s just nothing left, there’s no money, people have nothing, so how do they buy?” she said Reuters.

“Recently I came by and asked for three mandarins, two oranges, two bananas and half a kilo of tomatoes. When he told me it cost 650 pesos ($3.22). I told him to take everything out and leave only the tomatoes because I don’t have enough money.”

Politicians have also been accused of fighting among themselves as people “starve to death”, with the government cycling three different economics ministers in just four weeks last summer as the country’s economic crisis worsened.

There are also reports that President Alberto Fernández cannot agree with his deputy, Cristina Fernández de Kirchner, on how to deal with Argentina’s economic problems.

Yet polls have shown that inflation is a primary concern among Argentines, followed by corruption and poverty as elections are due in October.

Protesters took to the streets last September to demand action against the skyrocketing cost of living, while Argentina’s central bank said in February it would issue a new 2,000-peso note in response to the price hike.

Yet central bank money printing has been one of the factors reportedly contributing to rising prices, as the amount of money in public circulation quadrupled during the first three years of the presidency.

The International Monetary Fund (IMF) also signed a loan deal with Argentina, approving another $6 billion in bailout money in December.

Argentina has the second largest economy in South America, but a debt crisis in the 1980s also caused hyperinflation for a decade and the country continues to struggle to recover.

Analysis by Bloomberg last year revealed some shocking results on the cost of items for Argentines that Australians take for granted.

“A two-hour domestic flight costs as much as a month’s tuition, a pair of sneakers equals the minimum monthly Social Security payment, and a new iPhone costs half a year’s average rent or more,” the publication said.

Joanna Swanson

Joanna Swanson is Europe correspondent at the Thomson Reuters Foundation based in Brussels covering politics, culture, business, climate change, society, economies and inclusive tech. With specific focus in breaking news, she has covered some of the world's most significant stories.