Home NewsStock Market News Inflation can’t suppress Argentina’s central bank to raise interest rates to nearly 70% | Anue Juheng – Eurasian Shares

Inflation can’t suppress Argentina’s central bank to raise interest rates to nearly 70% | Anue Juheng – Eurasian Shares

by WOOWinvest
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Inflation can’t suppress Argentina’s central bank to raise interest rates to nearly 70% | Anue Juheng – Eurasian Shares


Argentina’s central bank on Thursday (11th) decided to raise interest rates by 950 basis points (38 yards, 1 yards is 25 basis points), strengthening the tightening force to suppress the inflation rate as high as 71%.

Argentina’s central bank raised its benchmark Leliq rate on the 28th to 69.5% from 60%. The country only raised interest rates by 800 basis points to 60% two weeks ago, when the government reshuffled its cabinet and created a new economic “super minister” to oversee manufacturing and agriculture.

The latest data, released on Thursday, once again underscored the urgency of raising interest rates. In Argentina, prices rose 7.4% in July, beating market expectations, and inflation over the past 12 months reached 71%. Soaring inflation has pushed President Alberto Fernandez’s approval rating to the lowest level since taking office in 2019, and long-serving economy minister Martin Guzman resigned early last month, causing another blow to the Afghan government. item strike.

The United States and Brazil have released reports on inflation this week. The outside world had expected that Argentina’s inflation would also ease, but it backfired.

Mexico’s central bank also announced another rate hike on the same day, up 3 yards to 8.5%, the highest level since the current policy was launched in 2008. Inflation in Mexico was 8.15% in July, the highest since December 2000.

Argentina’s central bank said one of the purposes of raising interest rates was to bring real rates closer to positive territory, one of the conditions of Argentina’s recent $45 billion debt deal with the International Monetary Fund (IMF).

In Argentina, where inflation could hit 90 percent by the end of the year, how to rein in it and deal with the old problems of high debt and excessive spending are the top priorities of the new economy minister, Sergio Massa. Massa on Thursday announced tax and duty concessions for the oil industry, as well as moves to boost investment in shale formations.

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