BUENOS AIRES, Argentina (AP) — Argentina reported a monthly inflation rate of 7.4% in July, the highest number in two decades for a country where citizens are used to increasing prices.
Over the past year, Argentina’s consumer prices have soared a whopping 71%, the INDEC national statistics agency said Thursday.
At a time when many people around the world are trying to deal with rapidly rising prices, these latest numbers cemented Argentina's position among countries with the highest inflation rates in the world.
The effects of the inflation scourge is plainly evident in Villa Fiorito, around 15kms (9 miles) from downtown Buenos Aires, where unemployed women gather in the hopes of bartering goods for food in a plaza.
Every afternoon, women set up their blankets and carefully lay out all kinds of goods, including clothes, toys and used kitchen utensils with the hope of exchanging them for food to feed their families.
The bartering that takes place every day in Villa Fiorito, famous for being the birthplace of late soccer legend Diego Armando Maradona, has emerged as a way for dozens of women who do not have a fixed income to make ends meet at a time when the cost of living has soared.
Things are likely to get worse before they get better in Argentina as analysts project that inflation this year will likely be higher than 90% with many speculating that a three-digit inflation rate is likely if the government of President Alberto Fernández fails to put the brakes on rising prices.
The price increases have hit food products particularly hard, worsening the poverty rate that already affects around 40 percent of the population of around 47 million.
Soledad Bustos, 31, sets up shop in the Villa Fiorito fair every afternoon while one of her children is in school and another is under the care of her sister.
Bustos offers jeans, leather boots, sneakers and shirts that she either took out of her own closet or bought through Facebook. In exchange she asks for powdered milk, which has become inaccessible.
“I can’t get to the end of the month, the money isn’t enough,” Bustos, a single mom, said.
Bustos is unemployed and says she receives around 36,000 pesos ($255) per month from the state, which is not enough to feed her family.
“I can’t survive with the welfare. Besides food I also have to buy the things for the kids’ school and medicine. I have no choice but to come here to be able to get a little more,” Bustos said.
These types of bartering fairs started spreading in Argentina after the economy collapsed in 2001 during the biggest economic crisis in its modern history. But they have reemerged in recent years amid a galloping inflation rate that has been stuck in double digits for years.
“This is living hand-to-mouth,” said María Inés Pereyra, 48, the coordinator of the fair that runs Mondays through Saturdays. “Whatever they obtain today they take it straight to the dining table.”
For safety reasons, only women can participate in bartering and most of the exchanges had already been previously arranged via Facebook or WhatsApp.
Although there is no set value for the used merchandise, Pereyra set a maximum price of 300 pesos ($2) for each item of clothing.
As an example, she pointed to a pair of leather sneakers that could be traded for a packet of sugar, cooking oil, flour and a local tea infusion.
Fernández's administration has blamed the high inflation rate in July on a currency crisis caused by “speculative movements that tried to generate a crisis of uncertainty and push a devaluation,” Gabriela Cerruti, the government’s spokeswoman, said Thursday before the inflation rate was released.
The acceleration of the country’s already high inflation rate comes shortly after the government had three economy ministers within one month amid uncertainty that led the local currency to depreciate sharply in the financial market.
Analysts, and even members of Fernández’s administration, expect the August inflation rate to be similar to July in part due to increases in the price of public transport and energy.
In Villa Fiorito, Bustos says she and her fellow barterers are only focused on “surviving.”