Argentina struggles with hyperinflation at 109% | DW Business

by | Nov 13, 2023 | Invest During Inflation | 19 comments

Argentina struggles with hyperinflation at 109% | DW Business




Argentina is second in a World Bank ranking of countries with the highest price rises. It hit almost 109 percent last month and this week the Argentine central bank increased interest rates to 97 percent. In this environment, paying for everyday needs becomes a constant worry and running a business especially challenging.

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Argentina battles with 109% inflation

Argentina, a country known for its economic struggles, is facing a new challenge as it grapples with an inflation rate of over 100%. The South American nation has been struggling with high inflation for years, but the current rate of 109% is the highest in more than two decades.

The soaring inflation is a result of a combination of factors, including a prolonged recession, a sharp depreciation of the peso, and loose fiscal and monetary policies. The COVID-19 pandemic has also exacerbated the situation, leading to a decline in economic activity and an increase in government spending.

The impact of the high inflation rate is being felt across the country. Prices of basic goods and services have soared, making it difficult for many Argentinians to afford daily necessities. The cost of living has become increasingly unmanageable, leading to widespread protests and social unrest.

The Argentine government has implemented several measures to try and combat inflation, including price controls and subsidies for basic goods. However, these measures have had limited success in curbing the inflationary pressures.

See also  Investment Strategies to Combat Inflation

The International Monetary Fund (IMF) has also been closely monitoring Argentina’s economic situation. The country currently has a $44 billion loan program with the IMF, and discussions are ongoing regarding the possible restructuring of the loan in light of the economic challenges facing the country.

In addition to the economic impact, the high inflation rate is also having political repercussions. President Alberto Fernández, who took office in late 2019, is facing growing discontent from the public over the government’s handling of the economy. His approval ratings have dropped significantly, and there are concerns about the stability of his administration.

The Argentine government is now facing a monumental task of getting inflation under control while also managing the country’s overall economic recovery. The road ahead is fraught with challenges, and it will require significant policy adjustments and tough decisions to bring about a sustainable solution to the inflation crisis.

The situation in Argentina serves as a stark reminder of the complex economic issues facing many countries, particularly those in the developing world. The government’s ability to stabilize the economy and restore confidence will be crucial in determining the country’s future trajectory.

As the battle with inflation continues, the eyes of the international community will be closely watching Argentina’s efforts to turn the tide and bring about a much-needed economic turnaround. Only time will tell whether the country will be able to overcome this daunting challenge and emerge stronger on the other side.

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19 Comments

  1. Blackjake

    Inflation, bank collapse, severe drought in the agricultural belt, recession, food shortages, diesel fuel and heating oil shortages, baby formula shortages, available automobile shortages and prices, the price of living place. <It's all coming together and it could lead to a real disaster towards the end of this year (or sooner). With inflation currently at about 6%, my primary concern is how to maximize my savings/retirement fund of about $300k which has been sitting duck since forever with zero to no gains.

  2. Brandon

    Thank your central bank directly for inflation

  3. Steve Taxpayer

    If America's democrats keep spending like Hunter Biden in a Russian brothel, the U.S. will end up with 109% inflation.

  4. Fredricksen

    They ain't battling it, they're feeding it.

  5. HORACIO PERALTA

    Cuando los argentinos salimos en los portales internacionales seguro que despues " se arma" ya estamos acostumbrados a los politicos estos!!!

  6. Andreas Eberle

    Wann möchte unsere Regierung endlich wieder das 2% bei der Inflation erreichen? Oder möchte diese den Umbau unserer Gesellschaft hiermit finanzieren? Welche Partei möchte die Inflation wirklich bekämpfen?

  7. Fred K

    Mistakes were made and no one made them.

  8. Ragab kamel

    My main concern now is how can we generate more revenue during quantitative times? I can't afford to see my savings crumble to dust.

  9. Scott Travis

    Are you looking to increase your income and plan for retirement? It is crucial to select stocks that have the potential to perform well in inflationary environments. To counteract the negative impact of inflation, diversifying your portfolio across various asset classes, including stocks, bonds, and real estate, is advisable as it can help safeguard your investments. I have witnessed individuals generating up to $500k in a month during periods of high inflation, and you have the opportunity to achieve similar results.

  10. Mark Jamison

    This is what the left brings to any country . Remember go woke go broke .

  11. indiandaeng

    Typical socialist country. High inflation and overthrow of leaders every couple of years while the citizens go broke.

  12. Althyk

    they seem to be so used to it, they dont care anymore. listening to them it seems what they do is complain, protest or ask foreign help.

  13. Ahmed Khan

    Why 109

  14. Unknown Human

    This all fault russian bad putin

  15. Kay Hussain

    American should take notes

  16. Jadi Max

    A racist nation deserves this judgment!

  17. GhostHD El

    They will get another loand from IMF. A friend of mine works in the local government, he is quite high up in the management level … he said he gets load of money from the government when the IMF loan goes through. He have 3 holiday homes with swimming pools, 3 cars and holiday 4 times abroad a year. He is like Lionell Messi. He also said that money from the IMF will not trickle down to the poorest.

  18. Rob1nson

    I’m an economist by training and having spent many months in Argentina over the recent past on holiday but travelling widely it’s not clear to me what the problem is as far as inflation is concerned. It doesn’t make sense. It’s a HUGE country with lots of natural resources, and should be self sufficient in the basics, the people are really hardworking and everything works well. People seem very positive about adapting to a situation which is difficult at best, and impossible for some.

    I don’t think it helps that the political leadership is very inward looking when the country would do well to create external links and inward investment. For example, Fernandez didn’t even go to the World Cup Final. And everyone says the politicians are on the fiddle but that doesn’t explain the inflation either.

    But its a wonderful country, the people are just great and if you get the chance to go seize it!

  19. Tim L

    What blows my mind is they say this is the worst………….then say since 1990. It's mind blowing there was a worse

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