2023-05-15 16:11:43
Argentina’s central bank on Monday announced a sharp hike in its interest rate, to 97%, for term deposits, as part of a series of planned government measures to thwart runaway inflation, which has topped 108 % over one year.
The central bank hiked the interest rate on term deposits from 91 to 97%, its second sharp rise in a month, in a bid “to prevent financial volatility from acting as a driver of expectations for ‘inflation,” she said in a statement.
Several other measures, in particular for small and medium-sized enterprises, intervention in the foreign exchange market, and facilitation of certain imports to reduce the price, should be announced during the week, according to local media. The Ministry of the Economy had not yet formalized others at midday on Monday.
This series of measures was prepared during a meeting this weekend around Economy Minister Sergio Massa, as a counter-attack following several particularly feverish weeks for Latin America’s third-largest economy, once morest a backdrop of uncertainty linked , also, to the holding of general elections in October.
At the checkout of a supermarket in Buenos Aires, May 3, 2023 / AFP / Archives
In mid-April, the Argentine currency, the peso, had suffered a spectacular erosion, losing 20% of its value in one week, falling to around 500 pesos to the dollar at the informal rate (nearly double the official rate) before restore to around 470 pesos.
The interest rate was subsequently increased by 10 points, to 91%, making it one of the highest in the world.
And last week, inflation, which had broken a three-decade record in 2022 (at 94.8%), continued its spiral with the publication of the April index, +8.4% over one month. , bringing inflation to 108.8% over one year. The increase in the cumulative cost of living since January 1 has reached 32%.
The central bank said in its statement on Monday that it will “continue to monitor the evolution of the general price level, the dynamics of the financial and foreign exchange markets, and monetary indicators, in order to calibrate its interest rate policy”. .
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