Inflation in Argentina falling-interest rates unchanged
2022.12.16 01:42
Inflation in Argentina falling-interest rates unchanged
Budrigannews.com – Even though Argentina’s annual price rises are expected to reach 100 percent by the end of the year, the country’s embattled government can take comfort in the fact that its monthly inflation rate decreased to 4.9% in November, the lowest level in nine months.
After one of the world’s most aggressive tightening cycles, Argentina’s central bank extended a pause on hikes and maintained its benchmark interest rate at 75% on Thursday, citing the cooling. In October, inflation was 6.3%.
Prices increased by 85.3% over the first 11 months of the year, according to the official INDEC statistics agency, with rolling 12-month inflation reaching 92.4% in November. However, the monthly rate was significantly lower than analyst expectations of 5.9%, making it the lowest since February.
Argentines continue to struggle with one of the highest rates of inflation in the world, which eats away at wages and reduces earning potential, despite the monthly slowdown. Nearly 40% of people live in poverty, forcing them to cut back on spending as prices rise.
While shopping for vegetables on the streets of Buenos Aires, Natalia Jones told Reuters, “It is difficult to manage a budget from one month to the next.” Instead of every six months, my rent is increasing every three months.”
More China industrial production has declined sharply
According to Eduardo Ortega, manager of a grocery store in Buenos Aires, this indicates that individuals are reducing the quantity of food they can purchase.
“Many habits have changed. In the past, people received one kilogram for every two. They do not now,” he stated. Previously, it was a whole fruit; now, it is only half. In just the last year, it has changed a lot.”
Through price freeze agreements with retailers, the government has attempted to reduce food costs. Housing, water, electricity, gas, and other fuels all saw 8.7% increases in November as a result of lower state subsidies.
In addition, analysts stated that the outlook remained complicated despite years of struggle to reduce prices.
“With fair evaluating strategies, it was normal that the ascent in the CPI would direct. Nonetheless, this action acts just as a fix and amplifies the issues ahead,” said financial specialist Santiago Casas, from the Fundacion Libertad y Progreso consultancy.
“Inflation will continue to be high without a stabilization plan implemented by a credible government with a solution for the debt in pesos and a reduction in the fiscal deficit,”
