Prices in Argentina jumped 4.7 percent in February, government data revealed this week, as officials vowed to step up efforts to tackle runaway inflation.
According to data published by the INDEC national statistics bureau, prices rose 8.8 percent in just the first two months of the year with Argentina’s inflation rate over the last year now standing at 52.3 percent – one of the highest rates in the world.
Prices had risen by 3.9 percent in January, indicating that inflation is on the rise.
The highest monthly increases in February were seen in food and non-alcoholic beverages, with prices up 7.5 percent, despite the introduction of a number of government-imposed price freezes on staple products. Food prices soared particularly in the Buenos Aires metropolitan area (AMBA), rising 8.6 percent.
In a press release, the Economy Ministry attributed the rise to the effects of the war that broke out between Russia and Ukraine, although it should be remembered that the conflict only began on February 24.
Drilling down further into food prices, the highest increases were observed in products that are not linked to international trade but to domestic dynamics: lettuce (up 72.7 percent from previous month), tomatoes (40.8 percent), onions (30.8 percent) and eggs (22.5 percent).
Speaking on Wednesday, Lower House Speaker Sergio Massa described inflation as "the most harmful poison" and called for a "new economic and social agreement to defeat inflation." He also said small and medium-sized businesses should be given greater assistance to ensure their survival.
Tackling inflation is one of the main aims of the US$45-billion financing programme agreed between Argentina and the International Monetary Fund (IMF), which is to be ratified this week by Congress.
"I hope that this week we can begin to put order in the issue of the tremendous debt we inherited," President Alberto Fernández said on Tuesday, noting that on Friday, if the agreement is approved by Congress, "the war against inflation and speculators will truly begin."
New measures, outlook
According to government sources quoted in local outlets Thursday, the national government planned to make a series of “announcements, measures and agreements” outlining its anti-inflation plan in the coming days, as from Friday, President Alberto Fernández anticipated earlier in the week.
Opposition leaders slammed the government’s inability to tackle runaway price increases, with lawmaker María Eugenia Vidal observing that Argentina had accumulated more inflation in the last two months than “129 countries did in 2021.”
She argued that Argentina’s inflation rate was now outpacing Venezuela’s, with her coalition colleague Senator Alfredo Cornejo declaring that the government had to form “a plan” and leave “improvisation” behind.
Argentina has suffered from high inflation for years, with the problem pre-dating both the current and former government.
In 2021, prices rose 50.9 percent in the calendar year, while in 2020 – a year of economic paralysis due to the Covid-19 pandemic – inflation reached 36.1 percent.
In 2019, in the final year of the Mauricio Macri administration, which preceded Fernández’s government, prices had risen 53.8 percent.
According to the fine print of the proposed IMF programme, inflation this year is projected to be between 38 and 48 percent.
In the agreement, Fernández's government has pledged to reduce Argentina’s fiscal deficit from its current rate of three percent of GDP to 2.5 percent in 2022, before dropping to 1.9 percent in 2023 and 0.9 percent in 2024.
Argentina’s next presidential election falls due in late 2023.