‘Zero capacity to save’: Argentines brace as inflation tops 104%

BUENOS AIRES, April 14 (Reuters) – Argentina’s annual inflation rate rose to 104.3% in March, the official statistics agency said on Friday, one of the highest rates in the world, straining people’s wallets and triggering a cost-of-living crisis that has pushed up poverty.

The inflation reading for the month came in at 7.7%, well above analysts̵[ads1]7; forecasts of 7.1%, marking the fastest monthly rise in years and increasing pressure on the government battling angry voters ahead of elections in October.

“I try to think that one day we will be better off. But the inflation we live with today in Argentina is terrible. It feels like never before,” said Claudia Hernansaez, an employee of the publishing company.

— In my case, I have zero capacity to save.

The skyrocketing prices have hammered wages and purchasing power, pushed poverty to nearly 40% and reduced the popularity of the ruling Peronist coalition in the run-up to general elections.

The country, a major global grain exporter, is also grappling with one of its worst droughts in history, which has hammered soybean, corn and wheat crops, knocked billions off the economy from lost exports and pushed up domestic prices.

Now every trip to the supermarket is a reminder of the country’s inflation crisis, the worst since 1991, which marked the end of a period of hyperinflation. Pensioner Juan Tartara said prices increased with each weekly visit to the shop.

“Sometimes the food goes up 10% or 15%,” he said. “In one year, beef went from about 1,000 pesos ($4.66) or 1,200 pesos to 2,800 pesos.”

Inflation is likely to be one of the defining issues for voters in October’s election, where liberal economist Javier Milei has gained traction in the polls with his promises to break the status quo.

President Alberto Fernandez’s approval rating has declined as inflation rises, currently hovering just above 20%. He has not yet confirmed whether he will seek re-election for another term.

Paola Lavezzari, also in publishing, said inflation forced her to tighten her purse strings and buy cheaper products.

“The first thing you lose is the quality of the product. Because what you used to consume of better quality is now unaffordable,” she said.

“Things were always maybe 10 pesos more, but now it’s 100 pesos more… When you do the monthly shopping trip, it’s so much. The difference is huge.”

($1 = 214.6700 Argentine pesos)

Reporting by Horacio Soria and Juan Bustamante; Author of Anna-Catherine Brigida; Editing by Sandra Maler

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