Central Bank of Argentina raises the basic interest rate to 69,5% per year

The Argentine Central Bank raised the basic interest rate to 69,5% per year. It was a 9,55% jump in interest rates in one month. According to ESPM's Professor of Economics and International Relations, Leonardo Trevisan, the reason is due to the fact that inflation hit 7,4% in July in the neighboring country. “It is the largest in Latin America, surpassing that of Venezuela, 5,3% last month”, he points out.

Over the last weekend, many meetings took place at Casa Rosada. On Sunday afternoon, rumors were growing stronger in Buenos Aires that an old trick will be resumed: a general price freeze. “As reality is too harsh, they thought – once again – of trying complete magic. For now, there are only “careful prices”, a halfway point to a more complete freeze”, analyzes Trevisan.  

The professor points out that the Argentine economic drama is not convenient. For Trevisan, the expectation is that Argentine inflation will reach three digits this year, having a strong impact on next year's elections in the neighboring country.