Argentina inflation surges to decades-high in March, sapping spending power

Argentina's monthly inflation rate soared to 6.7% in March, the government said on Wednesday, far above forecasts and the highest level in two decades as spiraling food and fuel prices dent the value of salaries and savings. The INDEC statistics agency said the annual inflation rate hit 55.1% in the month, above a Reuters analyst poll of 53.8%.

Argentina's monthly inflation rate soared to 6.7% in March, the government said on Wednesday, far above forecasts and the highest level in two decades as spiraling food and fuel prices dent the value of salaries and savings. The INDEC statistics agency said the annual inflation rate hit 55.1% in the month, above a Reuters analyst poll of 53.8%. Analysts had also predicted a monthly rise of 5.8%, though Economy Minister Martin Guzman had warned it would top 6%.

The monthly rate was the highest since 2002, INDEC said. "Money doesn't get you by nowadays," José Luis Rodríguez, an Argentine bricklayer, told Reuters while building a wall at a construction site in Buenos Aires, the capital. He said he now struggles to get by on his paycheck.

"The reality is that it doesn't buy you anything. If I get sick, I don't know who is going to feed my family." Argentina has been battling with high inflation for years with little success. That has been worsened as global commodities prices have climbed over the last year, exacerbated recently by the war in Ukraine.

People across South America have been hit hard, sparking protests against rising prices in Peru and long lines for food and fuel in Cuba. Central banks have been forced to sharply hike interest rates, a trend expected to continue. Experts predict Argentina's inflation will reach nearly 60% this year. That takes a steep toll on Argentines, almost 40% of whom already live in poverty even as a rebound in growth from the coronavirus pandemic has helped reduce that number.

In Buenos Aires some people protested on Wednesday demanding more state support, with banners reading "we are getting poorer." Others like bricklayer Julio Reinoso were selling baked goods on the street to supplement his regular income. "Inflation is forcing those of us who work in different sectors to do these kinds of bake sales," Reinoso said.

"We have no choice. If we are lucky, we can have two or even three jobs. And not even then do we make ends meet because one day products have a certain price and the next day it's a different one. That really kills people throughout the country."