(MENAFN) According to data released by the country's national statistics agency, Argentina's annual consumer inflation reached a new record of 104.3 percent in March, an increase from the 102.5 percent rise in February. This is the highest level of inflation for the South American country since the early 1990s. The latest figure surpassed market estimates of 97.6 percent, indicating a significant challenge for policymakers in the country.
Moreover, on a monthly basis, consumer inflation rose by 7.7 percent in March, compared to 6.7 percent in February. The figure was also higher than market expectations of 7.2 percent. The rise in inflation reflects the country's ongoing economic struggles, including a prolonged recession, high unemployment rates, and currency depreciation.
In response to the rising inflation, Argentina's central bank increased its benchmark interest rate by 300 basis points to 78 percent on March 16. This marks the first rate increase by the bank since September 15, 2020, when it hiked interest rates by a significant 550 basis points to 75 percent to counter rising inflation. The recent hike in interest rates is an attempt to control inflation and stabilize the economy, but it remains to be seen if it will be effective in the long term.
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