Argentina surpassed in a single month, February, the inflation that Spain registered in the entire last year: 6.6% against 6.1%. With this data, released this Tuesday by the National Institute of Statistics and Censuses (INDEC), Argentina accumulated 102.5% inflation in the last 12 months.
It is the highest figure since 1991, the year in which, during the government of the Peronist Carlos Menem, the Convertibility Plan was launched, which equated the peso with the dollar and eradicated, for a decade, inflation in a country that is addicted to to her. Thirty-two years later, another Peronist government, that of Alberto Fernández, once again shot inflation to more than 100% per year.
“The consequences are enormous and varied, but one stands out: the price is no longer a signal to buy, sell, produce, invest, and even determine effective public policies from the management of a country,” analyst Francisco Jueguen said today in The nation. “The consumer really stops knowing if something is cheap or expensive, but the money is not enough.”
The 6.6% inflation in February implies a serious setback for Economy Minister Sergio Massa, who took office in 2022 with the promise that in March he would reach a monthly figure that would start “in three”, a path of decline in prices. The reality is exactly the opposite, and the Fernández government does not seem to have the weapons to lower inflation: Argentina is fully entering the battle for the Casa Rosada, since a new president will assume office on December 10, 2023.
“There is no pocket that can hold it,” criticized Patricia Bullrich, one of the opposition presidential candidates. “It is not an exclusively economic problem, it is a political problem,” emphasized another opposition candidate, Horacio Rodríguez Larreta, who is today mayor of Buenos Aires.
The blows to Fernández and Massa, however, do not come only from the opposition: Cristina Fernández de Kirchner, Fernández’s vice president, insistently criticized the 100% annual inflation over the weekend during a public act.
Argentine inflation is the second highest in Latin America, only behind Venezuela’s 20.2% in February, which registers an annual rate of 537.7%.
The lack of control of prices is of such magnitude in Argentina, the third largest economy in Latin America, that the highest value bill, a thousand pesos, is equivalent to 2.5 euros in the informal exchange market, or five in the official one.
From the return of democracy in 1983 until today, the peso lost ten zeros in a country that experienced two hyperinflations, one during the government of the radical (social democrat) Raúl Alfonsín and the other under Menem. Argentines despise the peso and seek to save in dollars, euros or even cryptocurrencies. It is estimated that there are 350,000 million dollars outside the country, protected from the ups and downs of the crazy local economy, and a very important figure also kept in safe deposit boxes, homes and countless places in Argentina itself.
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