Argentina's inflation crosses 100% as people pay double for food amidst historic drought

As markets, malls and factories deserted during lockdowns slowly reopened, the pent up demand and restricted supply triggered a surge in prices globally. The inflation only became worse, with European countries and the US also bearing the brunt of the Russia-Ukraine war.

As rising interests rates meant to control prices are causing banks to shut down, Argentina has been hit by inflation above 100 per cent.

What does this indicate?

• For context, the desperate situation in Pakistan is a result of 31 per cent inflation, while it had hit 70 per cent in Sri Lanka during the crisis last year.

• Prices in Argentina have doubled for a large number of consumer products since 2022, and this is the first time that inflation has hit such levels since hyperinflation of the 90s.

• The current jump above 100 per cent is caused by a 6 per cent monthly rise, as Argentina has been blaming with an economic crisis and poverty for years.

Global inflation and climate change dealing multiple blows

• But Argentina isn't the worst hit, with Venezuela hitting 158 per cent inflation as people struggle to buy food, Lebanon at 143 per cent despite a drop and Zimbabwe's inflation rising to 285 per cent.

• Argentina's inflation is also aggravated by an unprecedented drought and lowest rainfall in 35 years, hitting agricultural produce in the country battered by a heat wave.

• The food and drink industry has seen a price rise of almost 10 per cent, despite the government placing price caps to control inflation.

Economic policy is all over the place because of a split within the government, and $6 billion received as part of a $44 billion IMF bailout plan hasn't prevented the decline.